PABC IPO oversubscribed 3.3 times: Rs4.6 billion raised

KARACHI: The Initial Public Offering (IPO) of the Pakistan Aluminium Beverage Cans Limited (PABC) has concluded with an oversubscription of 3.3 times, the company said in a statement on Wednesday.

The IPO received an overwhelming response from the institutional investors and high networth individuals, as the strike price clocked in at Rs49/share, 40 per cent higher than the floor price of Rs35, it said. The company raised Rs4.6 billion in total, making it the second largest IPO in the private sector.

“The response to the book-building has been phenomenal,” said Shahid Habib, CEO of Arif Habib Limited, the adviser and Book Runner of the issue.

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Several brokerage houses had issued almost unanimous calls to ‘subscribe’, which resulted in investors’ demand, amounting to Rs10.8 billion against the IPO’s book-building size of Rs3.3 billion.

The general public will subscribe to 23.4 million shares (25 per cent of the total offer size) on June 29 and 30 at the strike price of Rs49, the company said.

Azam Sakrani, CEO of Pakistan Aluminium Beverage Cans Limited, thanked the institutions and individual investors for showing interest and trust in the Pakistan Aluminium Beverage Cans Limited and assured that their investment in the company would yield greater dividends.

The company started its operations in 2017 as the country’s only local manufacturer of aluminum beverage cans.
PABC supplies beverage cans to the bottlers of all major carbonated drinks, including PepsiCo and Coca-Cola, in both Pakistan and Afghanistan. Exports to Afghanistan constituted 35 per cent of the company’s sales in the calendar year 2020.

Established on a 20.9 acres piece of land in Faisalabad Special Economic Zone with a current rated capacity of 700 million cans/annum, the company continues to enjoy a 10-year tax holiday. It is increasing its rated capacity by almost 36 per cent to 950 million cans/annum by July next year.

The company’s revenue has grown at an annualised rate of 18.7 per cent in the last five years. In the third full-year of its operation (2020), the net profit of the company amounted to Rs610.7 million, went up by 314 per cent, in comparison with 2019. It expects its bottom line to grow at 140 per cent in 2021.

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