IPO Added Under SEBON's Pipeline; Sarbottam Cement and Reliance Spinning Mills to Issue IPO Under Book Building Method

The following two companies Sarbottam Cement Limited (SCML) and Reliance Spinning Mills Limited (RSM) will now issue IPO shares through book building method. Book building is the process by which an underwriter attempts to determine the price at which an initial public offering (IPO) will be offered. While 40% of the shares will be sold to Qualified Institutional Buyers (QIB), 60% will be issued to the general public.

Sarbottam Cement Limited has submitted a proposal to issue 24,00,000 unit shares to Qualified Institutional Investors. This IPO issue will generate Rs. 24,00,00,000 for the company. Global IME Capital has been appointed the issue manager. The proposal was submitted on Ashad 28. The company has proposed to issue 60 lakh units out of which only 40% i.e. 24,00,000 shares will be issued to Qualified Institutional Investors remaining 60% i.e 36 lakh unit shares is for the general public. The present paid-up capital of the company stands at Rs 405 crores, which after this IPO will increase to Rs 465 crores.  

As per the preliminary bid submitted by QIB on 24th Asad, the minimum price stood at Rs. 501 per share. Based on this rate, the base rate came out to be 25% higher i.e. Rs 626.25 per share. However, the company can issue the share up to 20% high i.e. Rs 751.5 per share to the QIB. And later on, whatever the minimum cut-off rate of QIB would be, the general public will get shares at a 10% discounted price from the company.

Sarbottam Cement Limited was incorporated in October 2010 as private limited company and converted into a public limited company in July 2019. The company is involved in the production and selling of clinker and cement. The company’s major shareholding is from the Saurabh Group, a prominent business house in Nepal. Its factory is located at Ramnagar VDC-05, Nawalparasi district. The company mainly manufactures OPC and PPC cement under the brand “Sarbottam”.

Reliance Spinning Mills Limited (RSM) has submitted a proposal to issue 7,70,640 unit shares to Qualified Institutional Investors. This IPO issue will generate Rs. 7,70,64,000 for the company. Global IME Capital has been appointed the issue manager. The proposal was submitted on Ashad 31, 2079 in SEBON. The company has proposed to issue 19.26 lakh units out of which only 40% i.e. 7,70,640 shares will be issued to Qualified Institutional Investors remaining 60% i.e 11,55,960 units shares is for the general public. The present paid-up capital of the company stands at Rs 170.73 crores, which after this IPO will increase to Rs 190 crores. 

The company has recently conducted the roadshow program for the QIB on 23^rd Asad. As per the preliminary bid submitted by the QIB, the minimum price stood Rs 608 per share. Based on this, the base price stood Rs 760 per share. However, the company can issue share up to 20% higher than the base price i.e. Rs 912 per share to the QIB. And whatever, the minimum cut-off rate by QIB would be, the general public will get a 10% discount price from the company.

Reliance Spinning Mills Pvt. Ltd. was registered in the company registrar in the year 2051 B.S. With 4,300+ employees, Reliance Spinning Mills is the biggest of its kind in the country. The company manufactures Polyester, Viscous, Acrylic yarn of international standard that is then exported worldwide, primarily to India and Turkey. The company has two manufacturing units located at Khanar, Sunsari and Duhabi, Sunsari, Nepal. The total installed manufacturing capacity of the company is 40,680 MT per year as on mid-July 2021.