EPACK Durable sets Rs 218-230 price band for IPO worth Rs 640 crore

The share sale comprises Rs 400 cr of fresh issue and Rs 240-cr offer for sale by promoters, promoter group members, and existing shareholders who collectively be offloading 1.3 crore shares

EAPCK Durable, the second-largest outsourced design manufacturer of room air-conditioners, on Tuesday fixed a price band of Rs 218-230 per share for its Rs 640 crore initial public offering.

The share sale, which opens on January 19, comprises Rs 400 crore of fresh issue and a Rs 240-crore offer for sale by promoters, promoter group members, and existing shareholders who collectively be offloading 1.3 crore shares.

Pre-issue, promoters own 67 per cent of the company.

Two investor shareholders India Advantage Fund S4 I and Dynamic India Fund S4 US1, which are owned by ICICI Ventures, will be offloading a third of their total 20 per cent holding in the company, Bajrang Bothra, the chairman of the company told PTI here.

Ajay Singhania, the managing director & chief executive, said ICICI Ventures entered the company in September 2021 with a Rs 160 crore funding for around 20 per cent stake.

The company also has another external investor in Affirma Capital, which in September 2022 invested Rs 160 crore for a 13 per cent stake. This fund is not participating in the OFS, he added.

The other selling promoters/promoter group include, sale of up to 1,172,976 shares by Bothra, up to 6,66,798 shares by Laxmipat Bothra, up to 7,48,721 shares by Sanjay Singhania, and up to 7,48,721 shares by Ajay Singhania.

Sale of up to 2,86,351 equities by Pinky Singhania, up to 2,86,351 shares by Preity Singhania, up to 4,42,905 shares by Nikhil Bothra, up to 4,42,905 shares by Nitin Bothra, and up to 3,79,633 shares by Rajjat Kumar Bothra is also part of the OFS.

At the upper end of the price band, the issue is expected to mobilise Rs 640 crore.

Half of the issue size has been reserved for Qualified Institutional Buyers (QIB), 35 per cent for retail investors and the remaining 15 per cent for Non-Institutional Investors (NII).

Proceeds of the fresh issue will be utilised for funding capital expenditure for the setting up of manufacturing facilities, repaying Rs 80 crore of its Rs 170 crore debt, and general corporate purposes, Singhania said.

Founded in 2002, EPACK manufactures room air conditioners and small household appliances, and is keen to enter the entire spectrum of home appliances like induction cookers, hair dryers, mixer grinders, coolers among others, Singhania said.

It will remain on ODM player only and that it will not enter direct marketing or sales.

The ODM market is led by Amber, followed by EPACK which claims to enjoy 20 per cent of the market and the third largest player is PG Electro. Both these companies are already publicly traded companies.

Axis Capital, Dam Capital Advisors, and ICICI Securities are the book-running lead managers to the issue.