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Posted: Tuesday, 19 July 2022 08:58


Sula Vineyards Files Documents for the IPO

July 19: As predicted by delWine 6 weeks ago, Sula Vineyards, the leading producer of wine and importer of Alco- beverages has finally applied for a draft red herring prospectus (DRHP) for an initial public offer (IPO) with the stock market regulator, SEBI with the existing shareholders planning to offload their investment as the exit strategy through the sale of over 25.5 lakh shares of Face Value of Rs. 2, writes Subhash Arora who was the first to break the news on the electronic media when the promoting CEO Rajeev Samant, had neither confirmed nor denied its plans to come out with the IPO

According to the Mint the company posted revenue from operations of Rs. 453.92 crore in fiscal FY22 (April 21-March 22) showing an increase of 8.60% from Rs. 417.96 crore in FY 21- a year scarred by Covid. Surprisingly, its profit after (PAT) climbed to a whopping Rs. 52.14 crore in FY22 compared to merely Rs. 3.01 crore in FY21. The Report does not indicate how there could be a jump of over 17 times in one year.  To get a better perspective, Sula had registered a net profit of Rs.18.6 Cr in FY15 and Rs, 13.3 Cr in FY14, according to information in the public domain.

Also Read: Rajeev Samant: Indian Wine Market cruising along with Sula in the Lead

Interestingly, the offer is to help investors sell off their shares at the best possible price, disinvesting and unlocking the capital invested over the years, especially since 2010, in different tranches. These shareholders include the founder promoter CEO Rajeev Samant, and others including Cofintra SA, Haystack Investments Limited, Saama Capital III, Ltd, SWIP Holdings Limited, Belgian investor Verlinvest S.A and Verlinvest France S.A. Thus, the issue will be unique in the sense that the entire issue is an offer for sale (OFS) in which the existing professional shareholders will exit and the new shareholders will make an entry. The funds received will not be used directly or indirectly by the company.

Also Read: Reliance Capital to sell stakes in Sula and Grover Zampa?

Launched in 1999 by Rajeev Samant, Sula Vineyards is the leading producer which also exports a wide range of all variants of wine though it has reduced its emphasis on exports in recent years.  It has wineries in both Maharashtra and Karnataka (which it had bought from Heritage Winery 5 years ago in 2017). Over 90% of the produce comes from its vineyards in Maharashtra. It has leased wine making facilities in 6 wineries.

Also Read: Star Interview: Ravi Viswanathan- Co-owner of Grover and Sula –Part I

According to the Technopak report mentioned in the draft prospectus, the company has grown at a compound annual growth rate (CAGR) of 13.7% between FY2011 and FY2021.

Also Read: Global Perspective: Sula Stake Sale shows Industry has Bright Future

Subhash Arora


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