Resurgere Mines IPO price band fixed at Rs 263-272

Mumbai: Resurgere Mines and Minerals Ltd, a company engaged in the business of extraction, processing and sale of mineral products and exploration and development of mining assets, plans to enter the capital market with an IPO of 44.5 lakh equity shares of Rs 10 each.

More India business stories | Get the latest Sensex update

The issue will open on August 11 and will close on August 13. The price band has been fixed between Rs 263-272. The issue will comprise a reservation of 2.5 lakh equity shares for eligible employees, which will leave 42 lakh shares as net issue to the public. The shares will be listed on both the BSE and the NSE.

Crushing facilities

The company proposes to use the proceeds from the issue to part finance its plans for purchase of plant and machinery valued at Rs 128.56 crore for setting up of its own extraction and crushing facilities at the mines and purchase of six railway rakes worth Rs 116.36 crore to set up its own logistics infrastructure facilities. The company plans to raise Rs 121 crore through the issue.

The company has applied for a mining lease as well as two prospecting leases in Maharashtra. The iron ore mine of the company in Orissa has approximately 75 million tonnes of reserves. The company sells various grades of iron ore in the domestic spot market and exports iron ore fines to China.

Tips to book profits in stock markets! Click here

“We are now also looking at long-term contracts. We need to hedge against the volatility in prices. But we are diversifying into other minerals also. Our bauxite (alumina) mine is one such step,” said Subhash Sharma, Managing Director of Resurgere Mines and Minerals. Sharma added that the company has 60 per cent stake in a bauxite mining company in Maharashtra and is planning on mining copper, manganese and zinc.

The book running lead manager for the issue is Motilal Oswal Investment Advisors.