Marquee Anchors participate in Anchor book of Sanstar Limited

--The Company raises Rs. 153 crores from Anchor Investors ahead of its Rs 510 Crores IPO-----

Mumbai I Ahmedabad: July 18, 2024: Ahmedabad-based, Sanstar Limited has garnered Rs.153 crores from anchor investors ahead of its initial public offering that opens for public subscription on Friday, July 19, 2024. The Company informed the bourses that it allocated 1,61,10,000 equity shares at Rs. 95 per share on Thursday, July 18, 2024, to anchor investors.

The diversified anchor book of Sanstar Limited comprises 13 anchors including global financial institutions, domestic mutual funds, large insurance & NBFC treasuries, AIFs and foreign portfolio institutions. The institutions who participated in the anchor are the following:

• Global Financial Institutions: BOFA Securities (Division of Bank of America), Societe Generale

• Mutual Funds: BOI Mutual Fund, Trust Mutual Fund

• Institutional Treasuries: SBI General Insurance, Gagandeep Credit Capital, Chhattisgarh Investments 

• AIFs: Negen Undiscovered Value Fund, SB Opportunities Fund, Finavenue Capital Trust

• Foreign Portfolio Investments: Intuitive Alpha Fund, Minerva Emerging Fund

Sanstar Limited is one of the major manufacturers of plant-based speciality products and ingredient solutions in India for food, animal nutrition and other industrial applications (Source: Company Commissioned Frost & Sullivan Report, dated May 18, 2024). The majority of Sanstar products are used in food and nutrition industry. The products are used in custard, desserts, sauces, instant foods, tablets, baked foods, confectioneries, pastas, soups and mayonnaise, in cream fillings, gravies, tomato ketchup, creams, dairy desserts, in confectionary, candies, syrups, ready to eat sweets, bakery and so on. Sanstar products also find applications in personal care items, pharmaceuticals, nutrients, textiles and even biodegradable packaging materials amongst others. The Company also provides certified organic starch.

Sanstar exports to over 49 countries across Asia, Americas, Europe and Oceania, Middle East and Africa and derives more than 35% of the revenue from exports. During FY 2024, on a Consolidated basis, the Company generated ₹ ~1,067 crores of revenue, ~98 cores of EBITDA and ~ 67 crores of Profit After Tax (PAT) while ROE and ROCE were ~31% and 25% respectively. Revenue, EBITDA and PAT have grown at a CAGR of ~45%, ~57% and ~105% respectively during FY22-FY24, on a consolidated basis.

Sanstar operates two manufacturing facilities covering a total area of 10.68 million square feet (approximately 245 acres) situated in Dhule, Maharashtra, and Kutch, Gujarat. Notably, the Kutch facility of the Company is registered with United States Food and Drug Administration (USFDA). These facilities collectively boast an installed capacity of 3,63,000 tons per annum (1,100 tons per day). The Company ranks amongst largest manufacturers of maize-based specialty products and ingredient solutions in India (Source: Company Commissioned Frost & Sullivan Report, dated May 18, 2024). The Company has a bio-gas plant with an installed capacity of 1.56 megawatt to generate electricity from plant waste and utilize it as a renewable energy source and an installed solar plant of 3.6 megawatt capacity to generate electricity

To tap the next phase of the growth, the Company is in the process of expanding the capacity at Dhule facility on the existing land which is expected to increase 1,000 tons per day in capacity.

Pantomath Capital Advisors Private Limited is the sole book running lead manager. Lead Manager’s track record suggests that, all the IPOs lead managed by Pantomath Capital in last three years got listed on premium.

IPO Details

The Company is proposing to open its initial public offering of Equity Shares (the “Offer”) on Friday, July 19, 2024, and closes on Tuesday, July 23, 2024. The price band for the Offer has been determined at Rs 90 – Rs 95 per equity share. The IPO will fetch Rs 510.15 crore at the upper end of the price band.

The IPO consists of Fresh Issue of up to 41.80 million Equity Shares and an Offer for Sale (“OFS”) of up to 11.90 million Equity Shares by the Promoter and Promoter Group Selling Shareholders.

Sanstar will invest Rs 181.6 crore out of the net fresh issue proceeds for expansion of the Dhule facility. Another Rs 100 crore will be used to repay debts, which amounted to Rs 164.23 crore as of May 24 this year. The remaining funds will be utilised for general corporate purposes.

Investors can bid for a minimum of 150 equity shares and in multiples of 150 equity shares thereafter.

The Offer is being made through the Book Building Process, wherein not more than 50% of the Offer shall be available for allocation to Qualified Institutional Buyers, not less than 15% of the offer Shall be available for allocation to Non-Institutional Bidders and not less than 35% of the Offer shall be available for allocation to Retail Individual Bidders.

The shares of the Company shall get listed on 26th July on BSE and NSE.