Ellenbarrie Industrial Gases IPO: A Strategic Move for Growth
Ellenbarrie Industrial Gases, one of India’s oldest industrial gas manufacturers, is set to launch an Initial Public Offering (IPO) to raise essential funds aimed at both growth and financial stability. The company has submitted draft papers to the Securities and Exchange Board of India (SEBI) for approval. This IPO will involve the issuance of fresh equity shares worth Rs 400 crore, alongside a sale of 1.44 crore equity shares by the promoters through an Offer for Sale (OFS). Promoters Padam Kumar Agarwal and Varun Agarwal are expected to sell approximately 72.13 lakh equity shares through this OFS.
Pre-IPO Placement Opportunity
Ellenbarrie Industrial Gases is also contemplating raising up to Rs 80 crore through a pre-IPO placement before filing the Red Herring Prospectus (RHP) with the Registrar of Companies (ROC). Completion of this pre-IPO placement could lead to a reduction in the size of the new equity issue. Renowned financial firms such as Motilal Oswal Investment Advisors, IIFL Securities, and JM Financial are onboard as book-running lead managers for this initiative.
Utilization of IPO Proceeds
The funds raised through the IPO will be allocated as follows:
| Purpose | Amount (in Rs crore) |
|---|---|
| Debt Repayment | 177 |
| Air Separation Unit Setup | 130 |
| General Corporate Purposes | Rest of the proceeds |
After the IPO, Ellenbarrie aims to become debt-free, positioning itself for enhanced operational flexibility and growth opportunities.
Company Overview and Financial Performance
Based in Kolkata, Ellenbarrie Industrial Gases is recognized as a leading manufacturer of liquid oxygen and other industrial gases in East and South India. The company boasts the largest 100% Indian ownership in its sector based on installed manufacturing capacity as of FY 2024.
Financial Highlights
In terms of financial performance, Ellenbarrie witnessed significant growth within the last fiscal year. Key highlights include:
| Fiscal Year | Profit (in Rs crore) | Revenue (in Rs crore) |
|---|---|---|
| FY 2024 | 45.3 (61% growth) | 269.5 (31.4% growth) |
| FY 2023 | 28.1 (58% decline) | 205.1 (16.1% decline) |
Despite a challenging FY 2023, the company rebounded robustly in FY 2024, demonstrating resilience in the industrial gases market.
Diverse Customer Base
Ellenbarrie Industrial Gases services a broad spectrum of industries, boasting a customer base of 1,836 clients in FY 2024. Notable customers include:
- Jairaj Ispat
- Rashtriya Ispat Nigam
- Dr Reddy’s Laboratories
- Laurus Labs
- All India Institute of Medical Sciences (AIIMS)
- West Bengal Medical Services Corporation
- GMM Pfaudler
- Air India Engineering Services
- Jupiter Wagons
- Hindustan Shipyard
- Various PSU oil companies
Historical Context
Originally listed on the Calcutta Stock Exchange, Ellenbarrie Industrial Gases faced challenges leading to its delisting on July 2, 2018. The company has been trading on the BSE under permitted categories since July 3, 2008, though it was suspended from trading on March 8, 2017.
With the upcoming IPO, Ellenbarrie Industrial Gases seeks to consolidate its market position and fuel further growth initiatives, ensuring it remains a key player in the industrial gases sector in India.
