Hindalco shares fall 6% after Novelis postpones IPO citing market conditions

Hindalco Industries share price declined nearly 6% in early trade on Wednesday after its US  subsidiary Novelis Inc postponed its initial public offering (IPO) due to market conditions. Hindalco shares fell as much as 5.94% to 608.40 apiece on the BSE.

The company will continue to evaluate the timing of the offering in the future, Novelis said. 

The company had planned to raise between $810 million and $945 million from the offer. Novelis IPO price band was set at $18 to $21 per share, Hindalco Industries had announced last week. 

Read here: Novelis IPO: US subsidiary of Hindalco Industries declares price band at $18 to $21 per share

With the green shoe option available to the US primary market investors, the net proceeds from Novelis IPO were estimated to be between $931.5 million and $1.08 million.

The company’s sole shareholder AV Minerals (Netherlands) NV, another subsidiary of Hindalco Industries,was set to offload 45 million Novelis shares in the IPO. After a successful listing of Novelis shares, Hindalco Industries would have owned 555 million Novelis shares or 92.50% stake of its US subsidiary. 

Novelis IPO was slated to be the biggest by an Indian company in the US.

Novelis, the world’s largest recycler of aluminum, whose customers include Coca-Cola, Ford and Jaguar LandRover, was targeting a valuation of up to $12.6 billion in its US IPO.

Aditya Birla Group company Hindalco had acquired Novelis in 2007. 

At 9:25 am, Hindalco shares were trading 5.54% lower at 611.00 apiece on the BSE.

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Published: 05 Jun 2024, 07:27 AM IST

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