Our Bureau
12:15 PM, September 14, 2016
India's Cochin Shipyard Readies for Initial Public Offering
Cochin Shipyard

India's Cochin Shipyard (CSL) is eyeing to file documents for its initial public offering (IPO) of Rs 600 crores (US$89.6 million) with the Securities and Exchange Board of India (SEBI) by the end of this month.

The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India.

The publicly listed shipyard has hired a consortium of investment banks. The investment banks include SBI Capital Markets Ltd, JM Financial Institutional Securities Ltd and Edelweiss Financial Services Ltd, to manage the IPO, the Live Mint reported Wednesday. 

The Public Sector Undertaking (PSU) considers to raise funds as part of its efforts to expand and construct larger vessels and also undertake ship repair and fabrication. Besides, the government will sell 10 per cent of its stakes through the IPO.“Work on the DRHP (Draft Red Herring Prospectus) is almost complete. It is expected to be filed before the end of this month. The government is keen on completing the IPO within six months and is looking at a launch timeline of December-January,” a CSL official was quoted as saying by the news daily.

The Cabinet Committee on Economic Affairs has approved the sale shares in November, 2015. The IPO involves the sale of 34 million CSL shares that comprise 23 million new shares and 11 million central government's shares.

Further, proceeds from the sale of new shares would be used to partially finance the establishment of an international ship-repair facility at the nearby Cochin Port Trust and for a new dry dock to facilitate construction of larger ships and underwater repairs of rigs and semi-submersibles.

The expansion of CSL also includes extending its dry dock to allow the shipbuilder repair oil drilling rigs.

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