Defense equipment manufacturer SMPP Ltd has submitted initial documents to the Securities and Exchange Board of India (Sebi) to raise Rs 4,000 crore through an initial public offering (IPO). The offering includes a fresh issue of equity shares valued at up to Rs 580 crore and an offer for sale (OFS) of equity shares worth up to Rs 3,420 crore from promoter Shiv Chand Kansal, as outlined in the draft red herring prospectus (DRHP) submitted on Friday. Currently, Kansal owns a 50% stake in the company.
Additionally, the company is considering a pre-IPO placement of securities worth Rs 116 crore, which would reduce the size of the fresh issue if completed. The funds raised from the fresh issue will primarily be directed towards capital expenditures totaling Rs 437.04 crore.
This investment includes the construction of facilities, land development, and the acquisition of machinery for a new ammunition manufacturing unit through a subsidiary. The remaining funds will be allocated for general corporate purposes.
SMPP is a prominent Indian designer and manufacturer of defense equipment, producing ammunition components, personal protection gear, and platform protection kits for land, air, and sea applications. Since 1992, the company has specialized in producing combustible cartridge cases for tank and artillery ammunition.
Its personal protection products include bullet-resistant jackets, armor plates, ballistic helmets, and shields designed for armed forces, police, paramilitary, and other security agencies. The company also provides platform protection kits for vehicles, patrol boats, aircraft, and helicopters, intended for combat, counter-insurgency, and anti-terror operations. Axis Capital, ICICI Securities, IIFL Securities, JM Financial, and Motilal Oswal Investment Advisors are the lead managers for the issue. SMPP’s shares will be listed on both the BSE and NSE.
