Exclusive: Grasim selects SBI, Jefferies, Axis, and Kotak for a rights offering valued at Rs 4,000 crore

 Exclusive: Grasim selects SBI, Jefferies, Axis, and Kotak for a rights offering valued at Rs 4,000 crore

Building material and paints B2B online marketplace "Birla Pivot" was introduced by Grasim, using the synergies of the Aditya Birla Group. Its subsidiaries include Aditya Birla Capital and UltraTech Cement.

As the primary business of the $60 billion Aditya Birla Group looks toward carrying out its highest ever capital expenditure plan, Grasim Industries has chosen four investment banks as consultants for its proposed rights issue to raise up to Rs 4,000 thousands of dollars, multiple industry sources with an understanding of the matter told Moneycontrol.

One of the aforementioned individuals said, "The firm has selected Axis Capital, Kotak Mahindra Capital, Jefferies, and SBI Capital for the rights issue."

The bankers' statement was corroborated by two other individuals, who also said that the transaction may close before the end of the fiscal year, depending on market circumstances.

Under the condition of anonymity, the three individuals mentioned above talked with Moneycontrol.

Grasim did not respond to an email question at the time this story was published. The four banks did not respond to Moneycontrol's request for comment right away.

GRASIM: JUSTICE FOR RIGHTS ISSUE

Leading manufacturer of viscose, diverse chemicals, linen yarn, and textiles, Grasim, stated on October 16 that its board has authorized funding up to Rs 4,000 crores via a rights issue.

The company's stock has increased by 8.5 percent during the last six months, giving it a market value of 1.24 lakh crores.

"The proposed rights issuing by Grasim aims to fund the ongoing capital improvement plan, repay existing borrowings, and contribute to general corporate purposes," the stock market report said. With its largest-ever capital investment plan, Grasim is carrying out its transformative development path. The proceeds from this offering will primarily go toward growing capital expenditures, since the Company has used debt to partially finance its ongoing capital expenditure strategy. The company is on pace to meet its capital expenditure requirements and become the second-largest decorative paints player in India."

The statement went on to emphasize the promoters' and promoter group's engagement and said that they would completely subscribe to their entitlement to rights as well as to any portion that remained unsubbed, "demonstrating their deep conviction in Grasim’s growth prospects."

As per the most recent data available on the markets, the promoter category has a holding of 42.75 percent.

All additional stipulations of the rights issue, such as the issue price, rights entitlement ratio, record date, timing, and terms of payment as may sometimes be necessary, shall be determined by the Grasim board or a properly constituted Committee of the Board.

UMBRELLA GRASIM

Building material B2B online marketplace "Birla Pivot" and paint business have been introduced by Grasim, which has taken use of the synergies within the Aditya Birla Group. It is also the largest manufacturer of cement in India and a major participant in the diverse financial services industry via its subsidiaries, UltraTech Cement and Aditya Birla Capital. The company's FY 2023 EBITDA was Rs 20,478 crore, with consolidated net sales of Rs 1,17,627 crore.

Grasim launched the brand name "Birla Opus" for its paint company in September. Birla Opus is expected to be on sale in Q4 of FY24.. The company has already pledged Rs 10,000 crores for this particular area, and the combined capacity of its six production units is 1,332 mlpa (million liters per year).

At the brand launch, Kumar Mangalam Birla, Chairman of Aditya Birla Group, stated, "Our foray into decorative paints is a strategic choices for portfolios that enables us to tap toward a high-growth market and expand our influence in the vibrant Indian consumer landscape." This statement suggests that the company intends to become a profitable number two player in the upcoming years. Our paint company will grow by leveraging the strength and credibility of the Aditya Birla name."developed a variety of imported wood finishes and successfully launched the first-of-its-kind painting services in important metro areas. In Maharashtra, a state-of-the-art R&D center has already been established.

Prior to this, Grasim had pledged to spend Rs 10,000 crore to establish the paint company. With a combined capacity of 1,332 million litres per year (MLPA), the company's production facilities in West Bengal, Punjab, Tamil Nadu, Karnataka, Maharashtra, and Haryana will supply demand centers all across the nation.

Since the introduction, Grasim has successfully launched a variety of imported wood finishes and tested first-of-its-kind painting services in important metro areas. In Maharashtra, a state-of-the-art R&D center has already been established.

Prior to this, Grasim had pledged to spend Rs 10,000 crore to establish the paint company. With a combined capacity of 1,332 million litres per year (MLPA), the company's cutting-edge production facilities in West Bengal, Punjab, Tamil Nadu, Karnataka, Maharashtra, and Haryana will supply demand centers all across the nation.

The third phase of development by Ultratech Cement was revealed last week. With an expenditure of Rs 13,000 crores, the company plans to add an additional 21.9 mtpa (million tonnes per year), bringing the total domestic capacity to 182 mtpa.