Temasek-backed Milky Mist targets $1.13 bn valuation, fixes IPO price band

The Temasek-backed dairy company seeks a valuation of about $1.13 bn (₹10,778 crore) at the upper end of the price band after reducing its IPO size following a pre-listing stake sale

Temasek-backed Milky Mist Dairy Food [MILY.NS] set a price band of 133 to 140 rupees per share ($1.40-$1.47) for its ​downsized initial public offering that launches next week ​in Mumbai, a filing showed on Thursday.

At the top of ‌the range, the company is seeking a valuation of about ₹10,778 crore ($1.13 billion), just over half of market leader Hatsun Agro Product's market value of ₹20,283 crore.

Tamil Nadu-based Milky Mist slashed its IPO size to ₹1,553 crore from ₹2,035 crore on Tuesday after pre-listing stake sales to a unit of Singapore state investor Temasek.

Temasek unit Jongsong Investments, which now holds a roughly 5.2 per cent stake in Milky Mist, had ‌acquired shares at 139.76 rupees per share in an April pre-IPO placement.

 

The company is issuing new shares worth ₹1,428 crore in the IPO, while its founders are selling shares worth ₹125 crore.

Milky Mist, whose dairy products include cheese, butter and ice cream, plans to use part of the IPO proceeds to ​repay debt and expand and upgrade its flagship manufacturing facility in Perundurai, Tamil Nadu.

Anchor investors will get to bid on August 10, and the offering will be open broadly from August 11 to ​13. ‌The stock is expected to list on the BSE and National Stock Exchange ‌on August 18.

Milky Mist's rivals have struggled this year amid broader market declines and margin pressures due to high milk ‌procurement ​costs.

Hatsun Agro's ​stock has fallen 7 per cent so far this year. Dodla Dairy has dropped 16.5 per cent, Heritage Foods has plunged 27 per cent, Parag Milk ‌Foods has tumbled ​22 per cent.