Metal and Mining Co Tega files papers for Rs 750 cr IPO

Makes consumables for mining industry

F&S says Tega is the second largest producers of polymer-based mill liners

KOLKATA, Aug 18 (The CONNECT) - Tega Industries Limited, global leader in the design and production of consumables for the mineral beneficiation, mining and bulk solids handling industries has filed its Draft Red Herring Prospectus for initial public offering.

The issue will be a complete Offer for Sale (OFS) of 1,36,69,478 Equity Shares of face value of Rs. 10 each by Promoter and Investor Selling Shareholders. Details of OFS are “Promoter Selling Shareholders” 33,14,657 Equity Shares by Madan Mohan Mohanka, up to 6,62,931 equity shares by Manish Mohanka and up to 96,91,890 by Wagner Limited, an affiliate of the US-based private equity firm TA Associates. The Company will not receive any proceeds from the Offer since it involves only the Offer for Sale but the IPO size could be up to Rs 750 crore, market sources said.

Between FY19 to FY21, it’s Earnings before interest, tax, depreciation and amortization (EBITDA) has grown at a CAGR of 50.04% and Return on Capital employed has almost doubled.

As per the F&S Report quoted in the DRHP, globally, it is the second largest producers of polymer-based mill liners in terms of revenues for calendar year 2020, in a near oligopolistic market structure. Present across the value chain of a mineral processing site, providing a wide range of products and solutions for processing across different stages of mineral processing.

With an extensive global footprint in over 70 countries, Tega’s focus end-customers are mineral processing sites involved in gold and copper ore beneficiation accounting for 34.92 % and 27.25 % respectively, of its revenue from sale of products. It has manufacturing operations at Dahej in Gujarat and at Samali and Kalyani in West Bengal, and its international manufacturing operations are in proximity to the world’s major copper and gold mining locations in Chile, South Africa and Australia, with a total built-up area of 74,255 Sq. mts.

Despite some volatility in capital expenditure cycles for gold and copper mining sites, Tega’s business was not impacted, as a majority of its products were linked to the operating expenditure budget of a mining site and not capital expenditure.

Axis Capital Limited and JM Financial Limited are managing the issue while Link Intime India Private Limited is the registrar to the offer.

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