IPO entirely an OFS of equity by promoters: Tega Industries
Kolkata-based manufacturer of polymer-based mill liners Tega Industries' initial share sale will close for subscription on December 3.
Tega Industries, manufacturer of consumables for the mining industry, on Wednesday said the company's initial public offer (IPO) is entirely an offer of sale (OFS) of equity by promoters and existing shareholders.
The company's IPO to raise Rs 619 crore was fully subscribed on Wednesday, the first day of the bidding process. Kolkata-based manufacturer of polymer-based mill liners Tega Industries' initial share sale will close for subscription on December 3.
In an exclusive interview to CNBC-TV18, Mehul Mohanka, managing director and Group CEO, said, "In terms of capacity utilisation, the company is at about 50-55 percent. The company is in the process of further expanding capacity over the next couple of years to cater to its existing and planned growth into the future."
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“We would like to keep our capacity at not more than 75 percent to 80 percent utilisation because of the cyclical nature of how we manufacture products through the year," he said.
The company has lost a few weeks of production because of the lockdowns across the country. There were also some logistic challenges in terms of the availability of containers. That eased during the latter half of the COVID-19 situation.
"Even though we did experience COVID-19 challenges, we still grew quite well. Marginally we could have done better but we are quite happy with the results we have achieved in spite of the pandemic,” he explained.
In terms of margins, he said, “For us, a sustainable margin is 20 percent plus. Last year, I would say is a little bit of an aberration. So if I look at an adjusted EBITDA for one of the gains from expenses during the COVID period, I would say we would be normalised at around 22-22.5 percent. That is the sustainable level for us going forward."
In the global mill liner space, Taga Industries’ market share is at 5 percent.
“5 percent is a complete market for both steel linings and polymer linings put together. In terms of just polymer linings, we are the second-largest player in the world. We were close to about 3-3.5 percent two-three years ago and we've been nicely trending up and we see a strong impetus going forward," he mentioned.
For the full interview, watch the accompanying video.
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