Aegis Vopak IPO to open on May 26; sets price band at ₹223-235/share

Aegis Vopak Terminals, a subsidiary of Aegis Logistics Ltd, on Wednesday said it has fixed a price band of ₹223 to ₹235 per share for its ₹2,800 crore initial public offering (IPO).

The initial share-sale will open for public subscription on May 26 and conclude on May 28.

The bidding for anchor investors will open for a day on May 23, the company said.

The IPO is entirely a fresh issue of equity shares worth ₹2,800 crore with no offer-for-sale (OFS) component, according to the red herring prospectus (RHP). Previously, the IPO was planned to raise ₹3,500 crore.

Proceeds worth ₹2,016 crore will be used for payment of debt, ₹671.30 crore to fund capital expenditure for the acquisition of a cryogenic LPG terminal at Mangalore and the remaining amount will be allocated for general corporate purposes.

The company announced that 75% of the issue size has been reserved for qualified institutional buyers, 35% for non-institutional buyers and the remaining 10% for retail investors.

Investors can bid for a minimum of 63 equity shares and in multiples of 63 thereafter.

As of June 2024, the company had a total borrowings of ₹2,584 crore on its books.

Aegis Vopak Terminals owns and operates storage tank terminals across India. These terminals provide secure storage facilities for liquids like petroleum, vegetable oil, lubricants, chemicals, and gases such as LPG, propane, and butane.

The strategic location of the company's terminals near key ports, closer to major shipping routes, offers competitive advantages, including faster evacuation through pipelines, rail, and road, lower delivery costs, and improved delivery times.

The terminalling industry relies heavily on the strategic location of storage terminals. Terminals near major shipping routes and well-connected ports gain a competitive edge by reducing last-mile delivery costs and ensuring faster delivery times.

ICICI Securities, BNP Paribas, IIFL Capital Services, Jefferies India and HDFC Bank are the book running lead managers to the issue.