Nuvoco Vistas IPO : A Detailed Guide

  • 2
  • July 7, 2021
Nuvoco Vistas IPO Launch Date & Price

Nuvoco Vistas IPO Launch Date & Price

The Indian economy aims to be a USD 5 trillion economy by 2024-25; there is a massive push in the infrastructure sector and will be one of the key sectors to help India reach its target. Nuvoco Vistas Corporation Ltd, a Nirma group company focused on building material business, has grown over the years with several acquisitions and recently filed a draft red herring prospectus (DRHP) with SEBI and is looking to raise INR 5,000 crore via an initial public offer (IPO).

India was one of the fastest-growing economies globally before the pandemic struck, with a CAGR of around 6.7% from Fiscal 2015 to Fiscal 2020. India outperformed other significant economies in GDP growth at approximately 8% and 7% annually through calendar years 2016 and 2017, respectively. India’s GDP increased significantly from Rs 105 trillion in Fiscal 2015 to Rs 146 trillion in Fiscal 2020. However, due to the COVID-19 pandemic, CRISIL estimates that the Indian economy will shrink 7.7% in Fiscal 2021.

The infrastructure sector has been growing at a steady pace, clubbed with the government spending and push to the infrastructure sector, the growth is evident. The market is already abuzz with growth opportunities for this IPO. Here is all you need to know about the company, the Nuvoco Vistas IPO launch date, the Nuvoco Vistas IPO price, and how to apply for Nuvoco Vistas IPO.

Nuvoco Vistas Company Details 

It’s promoted by Dr Karsanbhai k Patel, founder of the NIRMA group. The Nirma Group is a conglomerate that has diversified into various products, ranging from detergents to detergents, healthcare products, soaps, and real estate development. The Nirma Group entered the cement business back in 2014 through a greenfield cement plant in Nimbol. As a part of the Nirma Group, Nuvoco Vistas has grown inorganically through multiple acquisitions.

The company manufactures cement; it is amongst the top five players in India and the largest cement producing manufacturer in East India, in terms of capacity, with a total capacity of 22.32 MMTPA. It runs a total of 11 cement plants; it includes five grinding units, five fully integrated units, and one blending unit. It has an established facility to operate in the RMX business with 49 RMX Plants across India. Nuvoco produces 4.2% of the total cement produced in India, about 17% of total cement produced in East India, and has a 5% production share in North India as of December 31, 2020. It is also one of the leading ready-mix concrete (RMX) producers in India.

Product Portfolio

Cement

The consolidated entity of Nuvoco Vistas Limited has well-recognised cement brands in the market Concreto, Duraguard, and Double Bull. The Company sells in west and central regions due to the proximity of these plants with the regions. The business accounted for approximately 84% of the company’s total sales in 2019- 20. 

The Company’s plants are state of the art. The Mejia Plant has one of the lowest specific energy consumption in the entire industry as per the company’s filings with Green Business Energy under The Confederation of Indian Industry. 

In terms of sales, the consolidated entity controls a market share of 5.1% in 9M FY21 with total sales of approximately 11.7 million tonnes.

Ready-Mix Concrete (RMX)

The company’s RMX business has a pan-India presence offering specialised products like Artiste and InstaMix. The company has over 49 plants as of March 2021 and has been increasing its presence across geographies. The company is one of the first movers in the industry. It has recently launched innovative products like InstaMix Mortare to supply wet-mix cement mortar in bags used for masonry. Further, the company launched InstaMix Microne, a ready-to-use wet micro concrete for structural strengthening and retrofitting.

Modern Building Materials (MBM)

The Modern Building Materials (MBM) product range under the InstaMix brands ann Zero M comprises multipurpose bonding, tile adhesive, construction chemicals, ready mix dry plaster, wall putty, waterproofing agents, and cover blocks.

Strengths 

  • The company has slowly built up a huge production capacity (22.32 MMTPA) via acquisitions. It is rightly placed to benefit from the rising infrastructure demand.
  • Nuvoco is a dominant player in East and North India.
  • It has an established brand in slag cement. 
  • The strategic locations of cement plants with good rail, road connectivity for quick transportation aids in fast shipment. 
  • Higher share in trade cement, which is for retail customers. It usually has better margins.
  • Three business lines in the building material allow for deeper penetration:
    • Cement
    • Ready-mix concrete (RMX) – leading manufacture in the country
    • Modern building materials such as adhesives, chemicals, wall putty, and so on

Risks

  • COVID-19 hurt the production. The construction sector has also suffered due to prolonged lockdowns and may take some time to recover. 
  • Raw material mining is a critical risk associated with cement production. Though the mining leases are long-term, the risk due to environmental concerns can come up unannounced. 
  • The company has grown inorganically via several acquisitions. Inability to integrate them as the company grows might adversely affect business.
  • Cement manufacturing is capital and labour-intensive business. It is prone to high debt and labour strikes. Servicing the debt is crucial; otherwise, it may derail operations.
  • Since the company has a higher share of trade cement, which is for individual home use, the covid impact is more elevated. 

Financials

As per the DRHP, these are the latest available financials.

For the year/period ended ( INR Cr.)
31-Dec-20 31-Mar-20 31-Mar-19 31-Mar-18
Total Assets 19,597.97 13,444.32 13,261.70 13,303.78
Total Revenue 4,857.21 6,793.23 7,052.13 6,855.51
Profit After Tax (63.45) 249.25 (26.48) 87.54
Total borrowings (as per balance sheet) 7,588.61 4,463.27 4,625.89 5,005.23

About the IPO

The public offer will have a new issue of shares of up to Rs 1,500 crore and an offer-for-sale (OFS) of Rs 3,500 crore by the promoter selling shares. Niyogi Enterprise Private Ltd, which currently has an 86.56% stake in the company, will dilute its ownership.

As per the DRHP, the proceeds from the IPO will be used to:

  • Repayment/prepayment/redemption, in full or part, of certain borrowings availed of by the company up to Rs 1,350 crore.
  • General corporate purpose.

Nuvoco Vistas IPO Launch Date & Price 

Nuvoco Vistas filed the DRHP in May 2021. The IPO launch date is not yet finalised but is expected to go live in June or July 2021. Nuvoco Vistas IPO expected share price is yet to be announced; the lot size and minimum order quantity will also be announced simultaneously. The face value of each share is INR 10.

How To Apply For Nuvoco Vistas IPO with TradeSmart

The quickest way to apply for Nuvoco Vistas IPO for existing investors is through their Demat accounts. But, if this is the first time you are participating in primary markets via an IPO and are wondering how to apply for Nuvoco Vistas IPO, then head over to TradeSmart online (Discount Broking firm) for a quick, easy and seamless IPO application process.

You can sign up for the TradeSmart platform in a few simple steps and use their ‘Box’ interface to apply for Nuvoco Vistas IPO. As a first step, select the “IPO” option from the ‘Portfolio’ menu in your TradeSmart Box account and search for the Nuvoco Vistas IPO from the list of current and upcoming IPOs. All the details related to the IPO, such as the open and close date, minimum order quantity, price range, and issue size, will be visible next to the IPO name.

As you locate the Nuvoco Vistas IPO in the list, click on the ‘Bid’ button next to it to apply for the IPO offer. TradeSmart allows you to bid for an IPO and pay through your UPI ID. So, all you have to do to bid for the Nuvoco Vistas IPO successfully is enter your UPI ID that is linked to your bank account.

You have to submit your bid at this stage, and you can easily apply for Nuvoco Vistas IPO. You can submit your bid at the cut-off price or a price that matches your investment budget. Remember, you can only place your bid for share quantity as per the allowed lot size, which is also indicated on the portal. After finalising the quantity and price for one or more than one bid, you can confirm that you have read the RHP (Red Herring Prospectus or IPO Draft Prospectus) and accept the UPI mandate on your UPI app to block the IPO application amount. The account is blocked as per ASBA, which means the money doesn’t move from your account but is simply blocked until the allotment is finalised. 

Once you complete the UPI mandate, your application for Nuvoco Vistas IPO will be confirmed, and you would have participated in the IPO process.

How To Apply For Nuvoco Vistas IPO with TradeSmart

The easiest way to apply for Nuvoco Vistas IPO for existing stock-market investors is through their Demat accounts. But, if you have never before participated in primary markets and are wondering how to apply for Nuvoco Vistas IPO, then head over to TradeSmart online for a simple and smooth IPO application experience.

You can register to the TradeSmart platform in a few simple steps and use their ‘Box’ interface to apply for Nuvoco Vistas IPO. Simply select the “IPO” option from the ‘Portfolio’ menu in your TradeSmart Box account and search for the Nuvoco Vistas IPO from the list of current and upcoming IPOs. Every important IPO information such as the open and close date, minimum order quantity, price range, and issue size will be visible next to the IPO name.

Once you have located the Nuvoco Vistas IPO in the list, click on the ‘Bid’ button next to it to participate in the IPO offer. TradeSmart allows you to bid for an IPO and pay through your UPI ID. So, all you have to do to bid for the Nuvoco Vistas IPO successfully is enter your UPI ID that is registered to your bank account.

Then you can easily apply for Nuvoco Vistas IPO by submitting your bid at the cut-off price or any other price that matches your investment budget. You can only place your bid for share quantity per the permissible lot size, which is also indicated on the portal. After finalizing the quantity and price for one or multiple bids, you can confirm that you have read the RHP (Red Herring Prospectus or IPO Draft Prospectus) and accept the UPI mandate on your UPI app to block the IPO application amount.

With this, your application for Nuvoco Vistas IPO will be confirmed, and you would have participated in the IPO.

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