Chennai: After three decades, a TVS Group company will seek an IPO this year. SEBI has green signaled the initial public offering (IPO) of TVS Supply Chain Solutions (TVS SCS). The last TVS Group company to seek an IPO was TVS Electronics in 1994.
TVS SCS had submitted its draft Red Herring prospectus to the market regulator for a Rs 5,000 crore IPO in mid-February. The IPO will consist of a new issue of shares with a total value of up to Rs 20,000 million (Rs 2,000 crore) and an offer to sell up to 59.48 million (nearly 6 crore) shares with a nominal value of Rs 1 each by the Promoter and Investor exist, the shareholders sell.
The company will use much of the net proceeds from the IPO (Rs 1,166 crore) to “repay or prepay its outstanding debt,” the company had said in a previous statement. “The upfront or scheduled repayment will help the company maintain a favorable debt-to-equity ratio and allow the use of internal reserves for further investments in the growth and expansion of the company,” it had added.
TVS SCS will also commit Rs 75.2 crore to capitalize strategically important subsidiaries in Germany, USA and Thailand in FY2023 to capture the growth opportunities in these markets. Another Rs 60 crore will also flow into the UK arm of the company to increase its stake in Rico UK to 100%. The remaining amount of the net proceeds will be used for inorganic growth and general corporate purposes.
JM Financial, Axis Capital, JP Morgan India, BNP Paribas, Edelweiss Financial Services and Equirus Capital are the lead bookers for the IPO. The IPO dates have not yet been announced.
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