• Source:JND
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TruAlt Bioenergy Ltd, a leading biofuel producer, has submitted preliminary documentation with the capital markets regulator Sebi in order to raise funds through an initial public offering (IPO).
The draft red herring prospectus (DRHP) states that the IPO will be a combination of a fresh issue of equity shares worth Rs 750 crore and an offer for sale (OFS) of up to 3.6 million equity shares by the promoters.

The OFS consists of up to 1.8 million equity shares each of Dhraksayani Sangamesh Nirani and Sangamesh Rudrappa Nirani. The company may consider raising Rs 150 crore under a pre-IPO placement round. If such a placement is completed, the size of the fresh issue would be decreased.

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Rs 425 crore of the fresh issue proceeds will be used to fund working capital requirements, while Rs 172.68 crore will be used to establish multi-feedstock operations. The remaining amount will be utilized for general corporate purposes.

TruAlt Bioenergy, based in Bengaluru, focuses on ethanol production and has a daily production capacity of 1,400 kiloliters (KLPD). The company intends to add an additional 600 KLPD of production capacity at three sites and aims to produce 2,000 KLPD by October 2024.

Trualt is expanding into new areas such as second generation (2G) ethanol, utilizing surplus bagasse — a by-product of sugar production — as a raw material. Additionally, the company plans to use 800,000 metric tonnes of bagasse from its promoter group companies to produce around 60 million liters of 2G ethanol per year.

Truault’s business performance is heavily influenced by the price and availability of raw materials like sugar syrup and molasses. To reduce its reliance on these seasonal resources, the company intends to shift its focus to grain-based ethanol production.

This strategic move would help to control material costs, optimize revenue, and maintain consistent ethanol production. Trualt Bioenergy’s revenue from operations stood at Rs 1,223.40 crore and its net profit stood at Rs 31.81 crore in FY24. DAM Capital Advisors and SBI Capital Markets are the lead managers handling the company’s IPO.

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(With PTI's Input