Sanstar IPO to Open for Subscription on July 19; Price Band Set at ₹90-95 per Share

India IPO

Updated July 15, 2024

Sanstar IPO price band is set at ₹90 to ₹95 per equity share. The subscription date is from July 19 to July 23.

Sanstar IPO to Open for Subscription on July 19; Price Band Set at ₹90-95 per Share

Sanstar Limited has set the price band for its upcoming IPO between ₹90 and ₹95 per equity share, with a face value of ₹2. The IPO subscription period will commence on Friday, July 19, and close on Tuesday, July 23. Anchor investors can begin bidding on Thursday, July 18. The floor price is 45 times the equity share's face value, and the cap price is 47.50 times the face value. The lot size for the IPO is 150 equity shares, with bids required in multiples of 150 shares.

The IPO will allocate up to 50% of the shares for qualified institutional buyers (QIB), at least 15% for non-institutional investors (NII), and 35% for retail investors. The allotment of shares is expected to be finalized on Wednesday, July 24, with refunds initiated on Thursday, July 25. Shares will be credited to demat accounts on the same day, and Sanstar is expected to list on BSE and NSE on Friday, July 26.

Sanstar, based in Ahmedabad, manufactures and sells products like dried glucose solids, liquid glucose, maltodextrin, dextrose monohydrate, and various starches and co-products. These products are used in a range of food items, including baked goods, confections, soups, sauces, creams, and desserts, serving as ingredients, thickeners, stabilizers, sweeteners, and emulsifiers. They also offer industrial and animal nutrition products.

Sanstar operates two production plants in Dhule, Maharashtra, and Kutch, Gujarat, spanning 10.68 million square feet. The company supplies products to 22 states in India and exports to 49 countries across Asia, Africa, the Middle East, the Americas, Europe, and Oceania.

According to the red herring prospectus (RHP), Sanstar's listed peers include Gujarat Ambuja Exports Ltd (P/E of 18.65), Gulshan Polyols Ltd (P/E of 73.31), and Sukhjit Starch and Chemicals Ltd (P/E of 15.01). Sanstar's revenue from operations grew at a CAGR of 45.46%, from ₹504.40 crore in fiscal 2022 to ₹1,067.27 crore in fiscal 2024, while profit after tax increased at a CAGR of 104.79%, from ₹15.92 crore in fiscal 2022 to ₹66.77 crore in fiscal 2024.

Sanstar aims to raise ₹510.15 crore through its IPO, which includes an offer-for-sale (OFS) of 1.19 crore shares valued at ₹113.05 crore by the promoters and a fresh issue of 4.18 crore equity shares valued at ₹397.1 crore by the company. Promoters Richa Sambhav, Samiksha Shreyans Chowdhary, and Rani Gouthamchand Chowdhary will be selling shares through the OFS. The proceeds will be used for expanding the Dhule facility, repaying or prepaying some of the company's debts, and general corporate purposes.

Pantomath Capital Advisors Private Ltd is the sole book-running lead manager, and Link Intime India Private Ltd is the registrar for the offer.