Gujarat-based Balaji Wafers opts out of PE funding, sets eyes on IPO

Gujarat-based Balaji Wafers opts out of PE funding, sets eyes on IPO

By TEAM VCC

  • 27 May 2014

Gujarat-based potato chips and snacks maker Balaji Wafers Pvt Ltd, which was reportedly in talks with top PE firms besides strategic investors to raise funds, is now looking at a possible initial public offering (IPO) for future expansion, as per a Business Standard report citing a top company executive.

The company is seeking a valuation of around Rs 4,000 crore for the overall business and plans to offer not more than 10 per cent equity stake in the proposed offering.

Balaji Wafers has planned to expand in north and south market in India and to set up the manufacturing units there for which it was eyeing private capital. It was reportedly in talks with PE firms such as Capital International, Blackstone and Actis having previously held discussions with strategic players such as PepsiCo among others.

However, due to a valuation mismatch the proposed deal did not materialise.

“As Indian economic and political scenario is changing and the country’s economy will surely grow in next five years under the new government, we have decided to take benefit of this and plan for an IPO," Keyur Virani, director of Balaji Wafers, told the newspaper.

He did not give any timeline to float the public issue.

The primary market for public issues has been virtually shut for the past one year. However, with the new government in place it is expected to open up. Benchmark indices are close to all-time highs and one firm Wonderla completed a successful IPO a few weeks ago. Another firm in the hospitality sector Adlabs Entertainment has just filed its documents to raise capital from the public. Earlier it had raised PE funding from ICICI Venture.

Balaji is currently present in states like Gujarat, Madhya Pradesh, Rajasthan, Maharashtra and Goa and is said to have a market share of 60-65 per cent in the wafers and snacks category in western India. Its revenue is more than Rs 1,200 crore and is expecting 25-30 per cent growth in the current financial year.

(Edited by Joby Puthuparampil Johnson)