Chemplast Sanmar Limited is going to open its initial public offering (IPO) on August 10, Tuesday. The speciality chemical manufacturer is planning on raising Rs 3,850 through its public issue this week. Chemplast Sanmar is a leading speciality chemical manufacturing company in India. It manufacturers speciality past PVC, resin and starting materials amongst other things. The company was incorporated in 1985 and is active in a few industries including agrochemicals, pharmaceuticals and the fine chemical industry. With the IPO right around the corner, here are a few key details you should know before subscribing.
10 Key Details about the Chemplast Sanmar IPO
1) Chemplast Sanmar IPO Issue Size, Breakdown
The Chemplast Sanmar IPO has an issue size of Rs 3,850 crore. The public issue also consists of a fresh issue that is worth Rs 1,300 crore and an offer for sale (OFS) that is worth Rs 2,500. The issue has a face value of Rs 5 per equity share.
2) Chemplast Sanmar IPO Dates
The company’s public issue is set to open on August 10 and it will remain open for three days. It will then close its subscriptions and trading on August 12. Any anchor bookings that might take place will happen on August 9, a day before the issue goes to market.
3) Issue Price Band
The Chemplast Sanmar IPO has an issue price band of Rs 530 to Rs 541 per equity share.
4) Chemplast Sanmar IPO Grey Market Premium
The IPO’s grey market premium was listed as Rs 0, on August 9, however, this may change when the issue goes to market on Tuesday.
5) Chemplast Sanmar IPO Allotment, Listing Details
The public issue is looking at a basis of allotment date of August 18. The listing date meanwhile is tentatively set for August 24 but this is not confirmed. The refunds for the bidders who failed to hook a share will be done on August 20, while the successful bidders will see their shares accredited to Demat accounts on August 23.
6) Object of the Issue
The company plans to use the proceeds from the IPO to fund the early redemption of NCDs issued by the company in full. The remainder of the funds will go towards general corporate purposes.
7) Chemplast Sanmar IPO Lot Size and Reservations
The IPO lot size on the lower end stands at 27 shares with a minimum application amount of Rs 14,607. On the upper end, the lot size is 351 shares with a maximum application amount of Rs 189,891 as the cap-off. The retail-individual investors can apply for up to 13 lots at the upper-most limit of the lot size. In terms of reservations, the qualified institutional buyers (QIBs) and the non-institutional investors (NIIs) have a reservation of 75 per cent and 15 per cent respectively. The retail category has a reservation of 10 per cent for the issue.
8) Company Profile and Financials
The company specialises in the manufacturing and distribution of speciality chemicals such as speciality paste PVC resin, starting materials, and intermediates. These products then go to sectors such as the agro-chemical, pharmaceuticals, agro-chemical, and fine chemical sectors. Other products by the company include Caustic Soda, Chlorochemicals, Hydrogen Peroxide, Refrigerant gas, and Industrial Salt. It has four manufacturing facilities. Three of these are located in Mettur, Berigai, and Cuddalore in Tamil Nadu. The Fourth is located in Puducherry at Karaikal.
On the financial front, the company had posted a turnover of Rs 3,815.11 crore and a net profit of Rs 410.24 crore for FY21. For the last three fiscals, the company had posted an average EPS of Rs 16.74 along with an average RoNW of NA on a consolidated basis. The net profit of the company has shown growth between FY19 to FY21. In FY19 the turnover stood at Rs 1,266.77 crore along with a net profit of Rs 118.46 crore.
9) Chemplast Sanmar IPO Promoters and Leads
The promoter of the company for this issue is Sanmar Holdings Limited. HDFC Bank will be the appointed global coordinator and BRLM for the issue. IndusInd Bank and YES Securities (India) will take charge of managing the issue. The registrar of the company’s IPO will be KFin Technologies.
10) Company Strengths
Chemplast Sanmar is one of the largest manufacturers of speciality paste PVC resins in India in terms of installed production capacity. It is also the third-largest manufacturer of caustic soda and the largest manufacturer of hydrogen peroxide in South India. It is also part of a prominent group of manufacturers in India – the SHL Chemicals Group. Aside from having an experienced management team, it also has a vertically integrated business model.
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