Anupam Rasayan India could soon hit Dalal Street with its initial public offering (IPO) after the company received a nod from capital market regulator Securities Exchange Board of India (SEBI) to raise Rs 760 crore. SEBI, in an update on its website, said that Anupam Rasayan was issued observations on February 26, giving the company three months to launch the IPO under the approved proposal.
So far in 2021, as many as eight companies have launched their IPOs on Dalal Street and many more are in the pipeline to tread on the same path amidst the liquidity-driven stock market rally.
Anupam Rasayan India is one of the leading companies involved in the custom synthesis and manufacturing of specialty chemicals in India. The issue of Anupam Raasayan will solely be a fresh issue of equity shares, according to the draft document filed with SEBI earlier in December. The issue will have 50% quota reserved for QIBs, 15% for Non-institutional investors, and 35% for retail investors. Anupam Rasayan’s IPO will also have a dedicated portion reserved for employees of the company.
The company plans to use the funds it will raise through the IPO for the repayment or prepayment of debt, equalling Rs 556 crore. The remaining amount will be used for general corporate purposes, according to the document. Prior to the issue, the promoter group of the company owns a 76.8% stake in the company while public shareholding is at 23.2%.
The company has 2 distinct business verticals; life science-related specialty chemicals comprising products related to agro-chemicals, personal care and pharmaceuticals, and other specialty chemicals, comprising specialty pigment and dyes, and polymer additives. Rapid industrialization in India and China is expected to drive demand for specialty chemicals, further aiding the growth of Anupam Rasayan. The draft offer document claims the industry’s capacity utilization had reduced to approximately 40% to 60% during the peak of the pandemic and lockdown in April to June 2020 due to labour shortages and disruptions in the supply of raw material.
In the previous fiscal year and in 6 months ended September 30, 2020, revenues of Anupam Rasayan from its life science-related specialty chemicals vertical accounted for 95.37% and 92.48%, respectively, while revenue from other specialty chemicals accounted for 4.63% and 7.52%, respectively, of its revenue from operations. Axis Capital noted that the company has developed strong and long-term relationships with various multinational corporations, including, Syngenta Asia Pacific Pte. Ltd., Sumitomo Chemical Co. Ltd. and UPL Ltd. that has helped them expand their product offerings and geographic reach across Europe, Japan, United States and India.