SSF Plastics India Ltd has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). The company, a key player in the packaging industry, plans to raise capital through a fresh issue of equity shares and an offer for sale (OFS).

SSF Plastics India Ltd Files Draft for an IPO with SEBI

SSF Plastics India Ltd Files Draft for an IPO with SEBI

SSF Plastics India Ltd has filed its DRHP with SEBI for an IPO comprising a ₹300 crore fresh issue and a ₹250 crore OFS.

SSF Plastics India Ltd has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). The company, a key player in the packaging industry, plans to raise capital through a fresh issue of equity shares and an offer for sale (OFS).

Business Overview and Financial Performance

SSF Plastics provides end-to-end packaging solutions across various product categories, including bottles, containers, caps, tubs, and engineered plastic components. Its diverse clientele spans industries such as personal care, home care, food and beverages, pharmaceuticals, engine oil, and consumer electronics.

For the six-month period ending September 2024, the company reported a profit of ₹15.19 crore on a revenue of ₹397.41 crore. Its listed competitors include Mold-Tek Packaging, Time Technoplast and Shaily Engineering Plastic.

IPO Structure and Fund Utilization

The IPO comprises a fresh issue of ₹300 crore and an OFS of ₹250 crore from promoters and promoter group entities, who currently hold full ownership of the company. The proceeds will be directed towards debt repayment, capital expenditure for plant and machinery acquisition, and general corporate purposes.

IIFL Capital Services Ltd and Nuvama Wealth Management Ltd are managing the issue as book-running lead managers.

The company is also planning to consider raising funds up to Rs 60 crore in the pre-IPO round. If it successfully closes pre-IPO placement, the such amount will be reduced from the fresh issue component, as per the draft papers filed on March 20.

SSF Plastics India claimed to be the fourth largest manufacturer of rigid plastic packaging products among the organised players in India, in terms of revenue in FY24. It provides services from design to delivery across key product segments such as bottles and containers, caps/ closures and tubs, and engineering plastic components, catering to several industries such as personal care, homecare, food and beverages, consumer electronics, engine oil and lubricants, and pharmaceuticals.

With 15 manufacturing facilities across India, the company has increased its customer base to 347 customers in the first half of current financial year, from 246 in fiscal 2022. Hindustan Unilever is the largest customer of the company, followed by Wipro, Dabur, Hindustan Foods, Emami, Himalaya Wellness, Colgate, RSH Global, Savita Oil, and Alkem Laboratories.

Conclusion

SSF Plastics’ IPO marks a significant step in its growth journey, aiming to strengthen its financial position and expand its operational capabilities. The offering is set to attract investor interest, given the company’s strong industry presence and financial performance.

SSF Plastics India that competes with listed peers like Mold-Tek Packaging, Time Technoplast at Shaily Engineering Plastic proposed to utilise Rs 160 crore out of net fresh issue proceeds for repaying debt which at the end of December 2024 was at Rs 400.3 crore.

Further, Rs 80 crore will be spent for purchase of plant and machinery, and the remainder for general corporate purposes.

On the financial front, the company recorded a 5.1 percent decline in profit at Rs 46.1 crore for the year ended March 2024 and 5.4 percent increase in revenue at Rs 630.9 crore compared to previous fiscal. Profit in the first half of FY25 stood at Rs 15.2 crore on