Mangaluru-based Mukka Proteins has announced the price band for its Rs 224-crore initial public offering (IPO) at Rs 26-28 per share. The issue will open for subscription on February 29, Thursday, and close on March 4, Monday.

The floor price is 26 times the face value of the equity share at Re 1 and the cap price is 28 times the share’s face value.

The issue will be a book-building process where investors will be allowed to make bids for a minimum of 535 shares and in multiples thereafter.

Up to 35% of the issue has been reserved for retail investors while non-institutional investors have been allocated 15%. As for the qualified institutional buyers (QIBs), a 50% quota has been reserved.

In June last year, Mukka Proteins refiled its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) to raise funds through an initial public offering (IPO). It had earlier filed its draft papers with the regulator in March 2022.

The issue which is worth Rs 224 crore has a face value of Re 1 per equity share and is entirely a fresh offering of up to 8 crore equity shares.According to the draft papers, of the total net proceeds to be raised through the IPO, the company proposes to utilise up to Rs 120 crore towards working capital requirements, up to Rs 10 crore for investment in its associate Ento Proteins Private Limited, for funding its working capital requirements besides general corporate purposes.The issue is being made through the book-building process, wherein not more than 50% shall be available for qualified institutional buyers (QIBs), not less than 15% of the issue shall be available for allocation to non-institutional bidders (NIB) and not less than 35% shall be available for allocation to retail individual bidders.

Mukka Proteins is one of the key players in the fish protein industry in India and is consistently being awarded by the Marine Products Export Development Authority (MPEDA) for its export performance.

According to a CRISIL report mentioned in the DRHP, in fiscal 2022 the company contributed 45-50% of the estimated Rs 1,300-Rs 1,700 crore revenue of the Indian fish meal and fish oil industry.

On a consolidated basis, Mukka Proteins’ revenue from operations grew 27.60% from Rs 603.83 crore in fiscal 2021 to Rs 770.50 crore in fiscal 2022 primarily due to an increase in sales volumes of fish meal and fish soluble paste and an increase in the selling price of fish meal. This resulted in a high realization per tonne of sale. The profit after tax increased 134.50% to Rs 25.82 crore in fiscal 2022, from Rs 11.01 crore in fiscal 2021.

For the nine months ended December 31, 2022, revenue from operations stood at Rs 756.41 crore and profit after tax stood at Rs 25.60 crore.

Mukka Proteins has 6 manufacturing facilities, of which 2 are held through its foreign subsidiary, namely Ocean Aquatic Proteins LLC, which is based in Oman and 4 are located in India. Additionally, the company runs 5 storage facilities and 3 blending facilities in India along strategically significant coastlines.

The company manufactures fish oil, which is used in the production of soap, leather tanneries, and the paint industry. Omega-3 pills and other related products gained from fish oil are also becoming more popular as healthful and high-nutrient dietary supplements.

Additionally, to sell its goods domestically, it exports its products to over 10 countries, including Bahrain, Bangladesh, Chile, China, Indonesia, Malaysia, Myanmar, Philippines, Saudi Arabia, South Korea, Oman, Taiwan, and Vietnam.

Fedex Securities Private Limited is the sole book-running lead manager and Cameo Corporate Services Limited is the registrar to the offer. The equity shares are proposed to be listed on the BSE and NSE.

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