Ellenbarrie Industrial Gases files IPO papers; aims to raise Rs 400-cr via fresh issue

New Delhi: Ellenbarrie Industrial Gases has filed draft papers with markets regulator Sebi to mobilise funds through an initial public offering.

The Kolkata-based company's IPO is a combination of fresh issue of equity shares valued at Rs 400 crore and an offer of sale (OFS) of up to 1.44 crore equity shares by promoters, according to the Draft Red Herring Prospectus (DRHP).

The OFS consists of the sale of 72 lakh equity shares each by promoters -- Padam Kumar Agarwala and Varun Agarwal.

Besides, the company may consider raising up to Rs 80 crore in a pre-IPO placement. If such placement is completed, the fresh issue size will be reduced.

Going by the draft papers filed on Wednesday, proceeds from the fresh issue to the tune of Rs 176.8 crore will be used for payment of debt, Rs 130 crore will be utilised for setting up an air separation unit at Uluberia-II plant and the remaining funds will be used for general corporate purposes.

With a legacy of 50 years, Ellenbarrie is one of the oldest operating industrial gas companies in India. The company manufactures and supplies industrial gases, including oxygen, carbon dioxide, nitrogen, helium, hydrogen and nitrous oxide, as well as synthetic air, fire-fighting gases, medical oxygen, liquid petroleum gas and speciality gases catering to a wide range of end-use industries.

It caters to the specific requirements of industries such as steel, pharmaceuticals and chemicals, healthcare, engineering and infrastructure, railways, aviation, aerospace and space, petrochemicals, food and beverages, energy, electronics, manufacturing, and defence.

As of March 2024, Ellenbarrie operates four facilities in West Bengal, two in Andhra Pradesh, one in Telangana, and one in Chhattisgarh.

It has listed clients, including Vizag Steel, Jupiter Wagon Ltd, All India Institute of Medical Sciences (AIIMS), Air India Engineering Services Ltd, Hindustan Shipyard Ltd, Indian Armed Forces and West Bengal Power Development Corporation Ltd.

On the financial front, Ellenbarrie's revenue from operations increased by 31.38 per cent to Rs 269.4 crore in fiscal 2024 from Rs 205.1 crore in the preceding fiscal and profit surged 61 per cent to Rs 45.2 crore in fiscal 2024 from Rs 28.1 crore in the previous fiscal.

The size of the industrial gases market in India was estimated at USD 1.22 billion in 2023, and is expected to reach USD 1.75 billion by 2028, growing at a CAGR (compound annual growth rate) of 7.5 per cent between 2023 and 2028, according to F&S report.

The large domestic market is driven by government initiatives such as 'Make in India' and the increasing call for import substitution, as well as demand from sectors such as steel, pharmaceuticals, manufacturing, defence, chemicals, healthcare, energy, pharma and electronics, and their growth prospects, it added.

Motilal Oswal Investment Advisors, IIFL Securities, and JM Financial are the book-running lead managers to the issue. The equity shares are proposed to be listed on BSE and NSE.