India's largest wine producer and seller, Sula Vineyards will launch its initial public offering (IPO) on 12 December. The IPO entirely offers for sale (OFS) where selling shareholders will offload around 2.69 crore equity shares for the public. Subscription in the IPO will be available till 14 December. Ahead of the IPO, anchor investors will be allowed to bid in Sula Vineyards on 9 December.
In a press meeting on Wednesday, Sula Vineyards announced its plan to raise ₹9.60 billion from the public offer. While they revealed that the shares offered in the IPO will be priced at ₹340 per share and ₹357 per share.
As per the red herring prospectus, the offer for sale will be 26,900,530 equity shares. Since the IPO is purely OFS, the proceeds will not go to the company. Selling shareholders are -- promoter Rajeev Samant, investors such as Cofintra S.A, Haystack Investments, Saama Capital III, SWIP Holdings, Verlinvest S.A, and Verlinvest France S.A.
Other selling shareholders are -- Dinesh G. Vazirani, J.A. Moos, Karishma Singh, Major A.V. Phatak, Narain Girdhar Chanrai, Ruta M. Samant, and Sanjay Naraindas Kirpalani.
The face value of equity shares would be ₹2 per share in the IPO.
Of the total, 50% of the IPO size will be allotted to qualified institutional buyers (QIB) for bidding, while 15% will be reserved for non-institutional investors (NIIs) and the remaining 35% will be kept for retail individual investors.
Kotak Mahindra Capital Company, CLSA India, and IIFL Securities are the book-running lead managers for the IPO. KFin Technologies is the registrar of the offer.
Sula Vineyards have been a consistent market leader in the Indian wine industry. Sula has made remarkable progress in over a decade. In the 100% grapes wine category, the company's market share on the basis of revenue, increased from 33% in FY09 to 52% in FY20 and further to 52.6 in FY21.
Currently, the company produces 56 different labels of wines across 13 district brands at its four-owned and two leased production facilities that are situated in Maharashtra and Karnataka.
In FY22, the company's revenue from operations was ₹4,539.16 million with a net sales margin1 of 69.83% and profit after tax of ₹521.39 million in the same period.
In the first half of FY23, the company's revenue stood at ₹2,240.68 million with a net sales margin of 74.32% and profit after tax of ₹ ₹305.06 million.
In its strategies ahead, the company plans to continue focusing on its own brands over third-party brands that they import and distribute. Further, the company will continue to leverage its distribution capability to launch new products. Also, they will increase wine awareness and consumption, and penetrate further into Tier-1 and 2 cities in India.
