Nuvoco Vista Corporation Limited: IPO Review

Nuvoco Vista Corporation Ltd incorporated on February 8, 1999, is the fifth largest cement company in India and the largest cement company in East India in terms of capacity. Nuvoco Vistas is part of Nirma Group. As of December 31, 2020, their cement production capacity constituted approximately 4.2% of total cement capacity in India, 17% of total cement capacity in East India and 5% of total cement capacity in North India, and they are one of the leading Ready-Mix Concrete (“RMX”) manufacturers in India.

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The company distributes its products through the trade segment, which mainly caters to individual home buyers, and the non-trade segment, which is mainly via direct sales to institutional and bulk buyers. As of March 31, 2021, it has 11 Cement Plants (eight in East India and three in North India). Its cement plants are in the states of West Bengal, Bihar, Odisha, Chhattisgarh and Jharkhand in East India and Rajasthan and Haryana in North India, while its RMX Plants are located across India.

Promoters & Shareholding:

Niyogi Enterprises Pvt Ltd and Dr. Karsanbhai K Patel are the company promoter with pre issue holding of 95.24%.

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Public Issue Details:

Offer for sale: Fresh issue of approx. 26,315,796 equity shares of Rs. 10 aggregating up to Rs. 1,500 Cr and OFS of approx. 61,403,509 equity shares aggregating up to Rs. 3,500 Cr.

Total IPO Size: Rs. 5,000 Cr.

Price band: Rs. 560 – Rs. 570.

Objective: To repay/prepay/redeem borrowings availed by the firm fully or partially and for general corporate purposes.

Bid qty: minimum of 26 shares (1 lot) for Rs. 14,820 and maximum of 13 lots.

Offer period: 9th Aug 2021 – 11th Aug 2021.

Date of listing: 23rd Aug 2021.

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  • One of the largest cement manufacturers in India.
  • Strong brand recognition and a large distribution network.
  • Professional and experienced management team.
  • The fastest growing cement company in terms of capacity addition on percentage terms with installed capacity doubling over the last five years post the acquisition of NU Vista.
  • Extensive sales, marketing and distribution network with diversified product portfolio.


  • Company has incurred losses for 2 years out of last 3 financial years.
  • Recently enacted Mines and Minerals Amendment Act, 2021 may result in lapsing of letters of intent for grant of mining leases us/ 10A of MMDR Act.
  • Highly competitive business environment.
  • Its business is dependent on its ability to mine / procure sufficient limestone for its operations and inability to do so can have adverse business impact.
  • Non-compliance with and changes in any laws relating to environment, health and sustainability will impact its business.

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Subscribe or avoid?

Cement demand is expected to face consecutive demand de-growth in Fiscal 2021 after a marginal dip in Fiscal 2020 as the cement industry witnesses a tumultuous transition between the two fiscal years. However, due increased government spending on infrastructure and housing segments, ample labour availability and key infrastructure projects like roads, metros and irrigation and the government’s drive to revive the housing segment are expected to drive potential cement demand in the near future to a CAGR of 6 to 7% from Fiscal 2021 to Fiscal 2026 which is expected have positive impact on the company and its business.

On the financial side, the company has reported revenue of Rs. 7,522.69 Cr, Rs. 6,829.94 Cr and Rs. 7,105.89 Cr in the FY21, FY20 and FY19 respectively and net profit of Rs. – (25.92) Cr, Rs. 249.26 Cr and Rs. – (26.49) Cr in the FY21, FY20 and FY19 respectively. It generated profits for FY20 where there is one timers for benefit of Rs 61 Crores for valuation of inventories and Rs 100 Crores due to lower “Other expenses” etc.

Looking at the valuation perspective, for the last 3 years average EPS of Rs 2.83, the P/E ratio is around 201x. P/E for FY21 cannot be determined as company has incurred losses and EPS is negative for this financial year. There are listed peers like Shree Cement trading at P/E 44x and ACC Cement trading at P/E 22x. Hence, the pricing of this IPO is expensive. Investors looking to invest in such companies need to wait and watch company performance for some more time. Considering all the above factors we recommend “AVOID” this IPO.

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This article should not be construed as an investment advise, please consult your Investment Adviser before making any investment decision. is an award winning personal finance platform. It helps you aggregate all your personal finance accounts like FD, Equity, Mutual Funds, PPF EPF, NPS including, Credit Cards & Loans etc. It's one place where you can track, plan and invest seamlessly. empowers you to invest in zero commission direct plans of mutual funds thereby helping you generate higher on investments. The best part is it comes with a lifetime Free plan.

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