Hyderabad-based Dodla Dairy Ltd has received regulatory approval to float their respective initial public Dodla Dairy, which counts US private equity firm TPG Growth as its backer, received the SEBI nod on 17 October.

Dodla Dairy

The IPO comprises a fresh issue of shares worth Rs 150 crore and a sale of 9.54 million shares by TPG and individual promoter Dodla Deepa Reddy. The total IPO size is estimated at Rs 500 crore.

Of the total secondary component, TPG has proposed to sell 7.82 million shares in the IPO.

The IPO will result in roughly 22-23% stake dilution on a post-issue basis after accounting for the fresh issue of shares. This may value the company at an estimated Rs 2,191 crore, VCCircle estimates show.

Edelweiss Financial Services and ICICI Securities are the merchant bankers helping the company manage the share sale.

Dodla was incorporated in May 1995. The company procures, processes and markets milk and value-added dairy products such as curd, ghee, butter, flavoured milk and ice cream. It gets about two-thirds of its revenue from milk and the remaining from dairy products.

The company is promoted by Dodla Sesha Reddy and Dodla Sunil Reddy. It operates under the brand names ‘Dodla Dairy’ and ‘Dairy Top’. It claims to be the second-largest by market share and the third-biggest milk procurer among private-sector dairy companies in India, with an average procurement of 1 million litres of raw milk per day.

The company operates through its factories and units in Andhra Pradesh, Telangana, Karnataka and Tamil Nadu. Internationally, it has operations in Uganda and Kenya.