Asia-focused private equity firm Creador-backed Vectus Industries Ltd, a maker of plastic storage tanks and pipes, is looking to go public and will soon file its draft prospectus for a Rs500 crore initial public offering (IPO), said two people aware of the development.
Vectus is a major manufacturer of polymer-based water solutions, manufacturing water storage tanks and pipes. The company was founded by Ashish Baheti and Atul Ladha in 2004.
“Vectus has been working on its draft IPO prospectus for some time and they are looking to file it by end of the current quarter. The IPO is expected to be around Rs500 crore in size, which will include a secondary share sale by the PE investor Creador,” said one of the persons cited above, requesting anonymity as he is not authorized to speak with the media.
In June 2014, Creador invested Rs100 crore ($16.7 million) through its second fund in Vectus Industries to acquire a minority stake. According to data from the company’s filings with the registrar of companies (RoC), Creador holds 21.65% stake in the company as of 31 March 2017.
“The company will use proceeds of the public offering for capital expenditure and working capital requirements,” the person cited above added.
Emails sent to Creador and Vectus Industries founders Baheti and Lodha did not elicit any response.
For the financial year 2016-17, Vectus Industries reported a standalone revenue of Rs532.7 crore, compared to a revenue of Rs501.7 crore in the previous year, according to data from the company’s RoC filings. In 2016-17, it reported a profit of Rs24.9 crore, as against a profit of Rs20.8 crore in the previous financial year.
The company sells water storage tanks under Vectus, Ganga and Waterwell brands. It also offers PVC, CPVC and composite pipes and fittings under the Vectus brand.
According to the company’s website, Vectus Industries has a distribution network of more than 3,500 dealers, over 10,000 retail counters, 14 manufacturing plants and 9 depots across the country. Revenues have grown at a CAGR of 23% between 2011-12 and 2017-18, it claims.
Creador, which last raised a $415 million fund to invest in India and South-East Asia, has across its three funds invested in several Indian companies.
Creador’s investments in India include PC Jeweller Ltd, Ashiana Housing Ltd, Corona Remedies, Paras Healthcare and Ujjivan Financial Services.
It has previously invested and exited from several Indian companies such as Somany Ceramics Ltd, Cholamandalam Investment and Finance Co. Ltd and Repco Home Finance Ltd.
Source: Mint