The initial public offering (IPO) of agrichemicals manufacturer Heranba Industries opened for subscription earlier today. So far, the issue was subscribed 84.18 per cent by the end of the first day of bidding.
It received a demand for 58,76,845 shares across both the stock exchanges against 69,81,417 shares on offer, data from NSE showed.
Heranba Industries will be available for subscription till Thursday, February 25, 2021, and the price band of the Gujarat-based crop protection chemicals manufacturer has been fixed at Rs 626-627 per share. The public issue is expected to fetch up to Rs 625 crore.
Investors who wish to subscribe to Heranba Industries IPO can bid in a lot of 23 equity shares and multiples thereafter. At the upper price band, they will be shelling out Rs 14,421 to get a single lot of Heranba Industries. The shares will be listed on both BSE as well as the National Stock Exchange (NSE).
All applicants of Heranba Industries IPO also must note that the cut-off time for UPI mandate confirmation is Friday, February 26, 2021, upto 12:00 pm. If they fail to do so then their application may not be considered.
The IPO comprises an offer for sale (OFS) of up to 90.15 lakh (90,15,000) equity shares, as per the information given in the red herring prospectus. The net proceeds from the issue will be utilised to finance the company’s working capital requirements and general corporate purposes, the red herring prospectus said.
Prior to the public offer, the anchor investors’ portion was open for subscription on Monday where Heranba Industries raised Rs 187.51 crore from 18 anchor investors, data from the stock exchanges showed.
Emkay Global Financial Services and Batlivala & Karani Securities India are the book running lead managers to the IPO while Bigshare Services is the registrar of the issue.
Geojit Financial Services and Anand Rathi Share and Stock Brokers in their respective research notes have all recommended “Subscribe” to the offer.
Geojit Financial Services in its IPO note said, “At the upper price band of Rs 627, HIL is available at P/E of 18.9x (annualized basis on FY21E EPS of Rs 33.2) which is reasonable compared to its peers. We assign a “Subscribe” rating for the issue on a long-term basis considering the strong distribution network, increasing export opportunity with healthy margins and profitability.”
Anand Rathi Share and Stock Brokers in its research report noted that “At the upper end of the IPO price band, it is offered at 22.67x its TTM EPS earnings, with a market cap of Rs 2,509 crores. Considering the company’s dominant position in pyrethroids market, strong balance sheet, high RoNW of 30.47 per cent as per FY20 financial statements, strong management and reasonable valuations; we give this IPO a “Subscribe” rating.”