Indigo Paints Shares Double Over IPO Price On Market Debut
A customer looks at paint samples at a store. (Photographer: Victor J. Blue/Bloomberg)

Indigo Paints Shares Double Over IPO Price On Market Debut

Shares of Indigo Paints Ltd. surged on market debut after investors piled into its maiden offer that concluded on Jan 22.

The paintmaker listed at Rs 2,607.5 apiece, a 75% premium over its issue price of Rs 1,490, according to data available on the bourses. The stock then continued to rise to close 109% higher at Rs 3,118.65 apiece.

Indigo Paints’ initial public offering was subscribed 117 times on the final day of issue, with institutional investors bidding for 189.6 times the shares on offer. The retail investor portion subscribed 15.93%.

The paintmaker’s maiden offer comprised a fresh equity issue worth Rs 300 crore and an offer-for-sale of Rs 870.16 crore by Sequoia Capital India Investments IV, SCI Investments V and promoter Hemant Jalan. Before the IPO, Indigo Paints had raised Rs 347.92 crore by issuing 23.4 lakh equity shares to anchor investors.

The company will use Rs 150 crore from the proceeds of the fresh issue to expand its existing manufacturing facility at Pudukkottai, Tamil Nadu; Rs 50 crore to purchase equipment and Rs 25 crore to repay debt and general corporate purposes.

Indigo Paints own 2% of the Rs 40,300-crore decorative paints segment—dominated by Asian Paints Ltd., Berger Paints India Ltd., Kansai Nerolac Paints Ltd. and Akzo Nobel India Ltd. that collectively own 66% of the market.

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