KARACHI: Panther Tyres Limited has planned to issue 40 million ordinary shares (28.57 percent of post IPO paid-up capital) with floor price of Rs47 (face value Rs10) and the cap of Rs65.8 (40 percent upside).
The entire Issue of 40 million shares will be offered through Book Building. Initially, 75 percent of the issue size i.e. 30 million shares will be allotted to successful bidders and 25 percent of the issue i.e. 10 million shares will be offered to retail investors.
The purpose of new issuance is to partially fund the Company’s expansion project and enhance the production capacities of Tyre Sets and Tubes (Packed) through import of state of the art 4 Roll Calendar Line from Comerio Ercole (Italy) and to bring in new technology for tyre manufacturing i.e. Radial Tyres, an analyst at Darson Securities said. Panther Tyres also intends to import fully automated Banbury Mixer from Farrel Limited (UK) that will reduce material wastages and bring in energy efficiency, he added.
Panther Tyres Limited has appointed Arif Habib Limited as the Lead Manager and Book Runner for its Initial Public Offering (IPO) of 40 million Ordinary Shares.
Incorporated in 1983, Panther Tyres Limited was the first player in Pakistan to introduce local manufacturing of tyres for two and three wheelers. Over period of time, the Company has expanded into other segments of automobile tyres and tubes including tractors, light commercial vehicles, trucks, buses and earth movers, an analyst at Arif Habib Limited said. Panther has a market share of 40 percent of Pakistan’s Motorcycle and Tractor tyre industry.
Panther has reached its optimal operation capacity in all segments of tyres and tubes. In tyres segment, the Company is operating at a capacity utilisation of 85.3 percent while in the tube segment operational capacity of the Company is 88.5 percent.
The Company has decided to undertake a major expansion project, not only to increase the production capacities of tyres and tubes but also to bring in new tyre manufacturing technology. In order to partly finance the expansion plan, the Company is raising capital through the IPO.
Copyright Business Recorder, 2021
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