New Delhi, Aug. 11 -- Singapore state-owned investment firm Temasek and Indian alternative investment firm Anicut Capital have put more money into a common consumer-oriented portfolio company that is going public.
Temasek, one of the most active private equity-style investors in India with a large portfolio of unlisted and listed companies, has picked up about 1.14 crore shares of Milky Mist Dairy Food Ltd for Rs 160 crore ($16.7 million) as part of the company's allotment to anchor investors ahead of its initial public offering.
Milky Mist allotted a total of 3.32 crore shares to more than a dozen investors at Rs 140 apiece, raising a total of Rs 465.3 crore. The anchor investors included nine mutual funds and one insurance company. In addition, Anicut invested Rs 10 crore while International Finance Corporation (IFC), the World Bank Group's private-sector investment arm, bought shares worth Rs 20 crore, according to a disclosure.
The IPO, which opened for subscription on Tuesday, was covered almost 80% at the end of the first day of bidding. Milky Mist has set a price band of Rs 133-140 per share for the IPO, which closes Thursday. At the top of the band, the company is seeking a valuation of about Rs 10,778 crore ($1.13 billion).
The total IPO size is Rs 1,553 crore. This comprises a fresh issue of shares worth Rs 1,428 crore while its founders are selling shares worth Rs 125 crore. Milky Mist will join dairy companies Hatsun Agro, Dodla Dairy, Heritage Foods and Parag Milk Foods on stock exchanges.
Ahead of the IPO, Temasek invested Rs 482 crore in Milky Mist in April this year at a price of Rs 139.76 per share. This investment lifted the dairy firm's post-money valuation to around Rs 9,334 crore, which is 55.6% higher than the Rs 6,000 valuation in 2024 when Anicut Capital took a partial exit. Temasek owned a 5.2% stake in the company before the IPO.
Milky Mist manufactures a variety of dairy products, including cream, cheese, butter, and yoghurt, and enjoys a strong presence in Tamil Nadu, Kerala, Andhra Pradesh, and Telangana.
The company raised external equity capital for the first time in 2020, mopping up Rs 19.5 crore from Anicut Capital. Two years later, it secured Rs 75 crore in debt from Anicut.
In 2024, Anicut made a partial exit, transferring some of the preference shares to a couple of individuals and AG Ventures. AG Ventures is the family office of Arvind Goenka, who heads Mumbai-listed companies Oriental Carbon and Chemicals Ltd and Duncan Engineering Ltd.
Anicut's partial exit in 2024 fetched around a multiple of about 5.8x on invested capital and an internal rate of return (IRR) of almost 64% in rupee terms, as per VCCircle estimates.
Published by HT Digital Content Services with permission from VC Circle.