Hindustan Laboratories and RK Steel Clear Regulatory Hurdle for Initial Public Offerings

Hindustan Laboratories and RK Steel Manufacturing Company Secure SEBI Approval for IPOs

Generic drug maker Hindustan Laboratories and steel tubes and pipes manufacturer RK Steel Manufacturing Company have secured the approval of the Securities and Exchange Board of India (SEBI) to raise funds through initial public offerings (IPOs), according to an update with the markets regulator on Thursday.

The two companies, which filed their preliminary IPO papers in September, obtained SEBI's observations on April 27. In SEBI's parlance, obtaining observations is equivalent to securing approval to float a public offering.

Key Details of the IPOs

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Hindustan Laboratories' maiden public offering comprises a fresh issue of 50 lakh shares, along with an offer for sale (OFS) of 91 lakh shares by the promoter, according to the draft red herring prospectus (DRHP). The company proposes to utilise IPO proceeds for funding the working capital requirements and general corporate purposes.

Hindustan Laboratories is an Indian pharmaceutical company primarily engaged in the large-scale manufacturing and supply of generic medicines to government institutions under a business-to-government (B2G) framework.

RK Steel Manufacturing Company's IPO is entirely a fresh issue of up to 2 crore equity shares with no OFS component, draft papers showed. The company plans to allocate funds towards repayment or prepayment of certain borrowings, working capital requirements, and general corporate purposes.

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Shares of both companies will be listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).