Tega Industries IPO Review 2021: Tega Industries’ initial public offer (IPO) will open for subscription on December 1, 2021, and close on December 3, 2021. The company is looking to raise ₹619.23 crores. The entire amount will be raised through Offer for Sale (OFS). In this article, we take a closer look at the Tega Industries IPO Review 2021. Keep Reading to find out!
About the Company
Tega industries commenced their operations in 1978 in India, with a foreign collaboration with Skega AB, Sweden. They are a leading manufacturer and distributor of specialized ‘critical to operate’ and recurring consumable products for the global mineral beneficiation, mining and bulk solids handling industry. Globally, they are the second-largest producer of polymer-based mill liners, on the basis of revenues for the calendar year 2020.
The company’s products offerings include consumables required in the mines and mineral processing industry. In the sequence, after blasting to floatation, their products range from chutes and liners, grinding mill liners, trommels and screens, hydrocyclones, pumps and flotation parts to conveyor products.
The company has 6 manufacturing sites, including 3 in India, at Dahej in Gujarat, and at Samali and Kalyani in West Bengal, and 3 sites in major mining hubs of Chile, South Africa, and Australia, with a total built-up area of 74255 Sq. mts.
Tega’s portfolio comprises more than 55 mineral processing and material handling products. They have 18 global and 14 domestic sales offices located close to their key customers and mining sites.
They have a strong global presence with 86.41% of their total revenue coming from operations outside India. The company have plans to establish its operations in major markets including North America, South America, Australia and South Africa.
Strengths of the Company
- It is a leading producer of specialized and “critical to operate” products, with high barriers to replacement or substitution as this is an oligopolistic form of market.
- The company is insulated from mining capital expenditure cycles. This is because the majority of their products are linked to the operating expenditure budget and not a capital expenditure.
- The company produces technology-intensive products which are backed by its strong R&D and high focus on Quality control and value addition.
- Tega industries is a long-standing market player with a global customer base and strong global manufacturing and sales capabilities.
Threats To The Company
- The company is a global manufacturer. Hence the sales and operations are exposed to foreign risks such as market instability, currency fluctuations, compliance issues, restrictions on trade, difficulty to acquire resources among others.
- The requirement to maintain a good network with dealers and distributors to have a competitive advantage over the competitors comes with additional costs.
- Tega industries dependents on third-party logistic and support service providers for the delivery of raw materials and finished products. Any disruptions in the supply chain can adversely affect the operations.
- Tega industries is a capital intensive business. There may be difficulty to obtain sufficient capital on favourable terms, which may hamper their business and growth.
Grey Market Premium
The shares of Tega Industries traded at a price of Rs. 320 ahead of its IPO. The cap price for Tega Industries IPO is 453. The estimated listing price for Tega Industries IPO as of current GMP is ₹773. The expected gain is around 70%.
Key IPO Information
The Promoters of the company are Madan Mohan Mohanka, Manju Mohanka, Manish Mohanka and Mehul Mohanka. The company has appointed two Book running lead managers Axis Capital Limited and JM Financial Limited.
|IPO Size||619.23 Cr|
|Offer for Sale (OFS)||619.23 Cr|
|Opening date||December 1, 2021|
|Closing date||December 3, 2021|
|Face Value||₹10 per equity share|
|Price Band||₹443 to ₹453 per equity share|
|Lot Size||33 Shares|
|Minimum Lot Size||1|
|Maximum Lot Size||13|
|Listing Date||December 13, 2021|
Objectives of the issue
- The object of the Offer is to achieve the benefits of listing the Equity Shares on the Stock Exchanges.
- Offer for Sale
In this article, we covered the Tega Industries IPO Review 2021. The Initial Public Offering opens on December 1st and closes on December 3rd. For investors, it can be a good opportunity to look into the company and apply for the IPO after analysing the prospects and strengths.
Are you applying for this IPO or not? Do let us know in the comments below.