Pakistan: Fruit and Potato Exporter Raises Rs1.2 Billion as IPO Book-Building Is Oversubscribed 1.6 Times
An exporter of kinnow, mangoes and potatoes from Sargodha raised Rs1.2 billion in the book-building part of its IPO. The money will fund seasonal procurement and processing.
A Pakistani exporter of fruit and potatoes has completed the book-building part of its initial public offering. Demand was 1.6 times higher than the shares on offer.
The company is SE Fruits and Vegetable Limited. It is based in Sargodha, in Punjab province. It formerly operated as Shaheen Enterprises and has worked for nearly three decades.
According to the reports, the company processes and exports kinnow, mangoes and potatoes. It sells these and other agricultural products to more than 22 countries.
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Book-building ended on 22 September. The strike price was Rs40 per share. This was the floor price set before the offer.
The offer includes 30 million ordinary shares. This is 32.01% of the paid-up capital after the listing. At Rs40 per share, the total offer is worth Rs1.20 billion.
The book-building part covered 22.5 million shares, or 75% of the issue. It was fully subscribed within two hours of opening on 21 September. Its value at the strike price is Rs900 million, according to Business Recorder.
The remaining 7.5 million shares will be offered to the general public on 28 and 29 September. This part is expected to raise Rs300 million.
The company plans to use the money mainly as working capital. According to the company, the funds will support larger seasonal procurement, higher processing throughput and more export sales.
Two brokers are joint lead managers of the issue: Topline Securities and Growth Securities.
The reports do not say how much of the company’s revenue comes from potatoes. The main export crops named first are kinnow and mangoes.
Why it matters
Most potato trade in Pakistan is financed by traders and cold-store owners. A listed exporter with fresh working capital can buy larger volumes in the harvest season. This may add a new buyer in the export chain, which sends potatoes to markets such as Afghanistan, Central Asia and the Gulf. The public subscription at the end of September will show the interest of small investors in the agricultural export sector.
Photo: Potato fields in Hunza Valley, Gilgit-Baltistan, Pakistan (illustrative). Irfansheen / Wikimedia Commons, CC BY-SA 4.0
