Updated: June 23, 2021 3:34:12 pm
India Pesticides IPO: The Rs 800 crore initial public offering (IPO) of India Pesticides (IPL) for subscription earlier in the day and will be available for subscription till Friday, June 25, 2021. The IPO has a price band of Rs 290-296 per share.
The offer by the Uttar Pradesh-based agrochemical company comprises fresh issuance of equity shares amounting to Rs 100 crore and an offer of sale for equity shares aggregating up to Rs 281.4 crore by promoter Anand Swarup Agarwal and up to Rs 418.6 crore by other selling shareholders.
Before heading into the IPO, India Pesticides raised Rs 240 crore (Rs 239,99,99,672) from 16 anchor investors in lieu of 81,08,107 equity shares at Rs 296 each, data from the stock exchanges showed.
The anchor investors include the likes of SBI Mutual Fund, Nippon India Mutual Fund, Tata Mutual Fund, Bajaj Allianz Life Insurance Company, Bharti AXA Life Insurance Company, Abu Dhabi Investment Authority and BNP Paribas.
The net proceeds from the fresh issue would be used towards funding the working capital requirements and general corporate purposes.
India Pesticides is an R&D-focused agrochemical technical company, which has growing formulations business in herbicides, insecticides and fungicide segments. It also manufactures active pharmaceutical ingredients (APIs). It operates from two manufacturing facilities at Lucknow and Hardoi in Uttar Pradesh with an aggregate capacity of 19,500 MT for technicals and 6,500 MT for the formulations vertical.
Investors who wish to subscribe to India Pesticides IPO can bid in the lot of 50 equity shares and multiples thereof. At the upper price band, they will have to shell out Rs 14,800 to get a single lot of India Pesticides. The shares will be listed on both BSE as well as the National Stock Exchange (NSE).
The applicants also must note that the cut-off time for UPI mandate confirmation is Monday, June 28, 2021, upto 12:00 pm. If they fail to do so then their application may not be considered.
Axis Capital and JM Financial are the book running lead managers to the IPO while Kfin Technologies is the registrar of the issue.
The research teams at Anand Rathi Share and Stock Brokers and Motilal Oswal Financial Services in their respective IPO notes have recommended “Subscribe” to the offer.
Motilal Oswal in its IPO note said, “We like IPL given its presence in fast growing agrochemical space, diversified product portfolio and robust financials. Strong R&D, long term relations with MNCs, cost competitiveness and extensive distribution network are some of the other key positives. Expanding product portfolio, growing customer base and increasing wallet share of existing customers can help IPL maintain its growth momentum. The issue is reasonably valued at 25.3x FY21 P/E on post issue basis, vis-à-vis peers (avg. peer P/E of 36.4x), while it enjoys higher RoE of 36% (avg. peer RoE of 21%). Hence, we recommend Subscribe.”
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