Shankara Building Material launches fund raising drive

An organized retailer of home improvement and building material, Shankara Building Products Ltd, has recently launched fund raising drive and appointed an investment bank to generate ₹300 crore through a qualified institutional placement (QIP), said sources, adding that the newest is the second initiative as in March 2017, Shankara had raised Rs.345 crore in an initial public offering, which was subscribed 41.6 times. Promoted by first-generation entrepreneur and IIM-Ahmedabad alumnus Srinivas Sukumar, listed on stock exchanges in April 2017, its shares have risen over three times to close at ₹1,533.4 a piece recently and that the company had sold its shares in the initial public offering at ₹460 each. The company has appointed ICICI Securities to advise on the fund raising drive.

As a matter of fact, the company is looking to raise capital for working capital needs, inorganic growth and expanding its retail footprint. On 12 June, this year Shankara’s shareholders had approved a resolution to allow it to raise ₹300 crore through various routes, including a QIP. The building material company’s range of products includes cement, structural steel, TMT bars, hollow blocks, pipes and tubes, roofing solutions, welding accessories, primers, solar heaters, plumbing, tiles, sanitary ware, water tanks, plywood, kitchen sinks, lighting and other related products. According to sources, Shankara owns 131 stores with a retail footprint of 0.51 million sq. ft across nine states and one Union territory, in western and southern India. It sells products under its own brands, including CenturyRoof, Ganga and Loha, apart from third-party merchandise, they added.