Chemplast Sanmar Ltd. has fixed its IPO price band at Rs. 531 – 540 per share with a face value of Rs. 5 apiece. This initial public offering of this chemical company is slated to open on 10 August 2021 and close on 12 August. Chemplast Sanmar wishes to raise Rs. 3,850 crores through its IPO.
Chemplast Sanmar is a top speciality chemical manufacturer in the country. Founded in 1985, this company deals with manufacturing starting materials, speciality paste PVC resin, pharmaceuticals, and intermediates of agro-chemicals. In addition, it also produces refrigerant gas, caustic soda, industrial salt, and more.
The company has 4 manufacturing facilities at Berigai, Mettur, and Cuddalore in Tamil Nadu and Karaikal in Pondicherry.
Chemplast Sanmar wants to utilise the proceeds from its IPO for:
The Chemplast Sanmar IPO will consist of a fresh issue of Rs. 1,300 crores along with an OFS of Rs. 2,550 crores by its promoters Sanmar Engineering Services and Sanmar Holdings. 75% of the total offer will be reserved for qualified institutional buyers while 10% for retail investors. The rest of the 15% is meant for non-institutional investors.
Sanmar Holdings will sell shares worth Rs. 2,463.44 crores, while Sanmar Engineering will exit equity shares of Rs. 86.56 crore during the OFS.
Here are some key details about the Chemplast Sanmar IPO:
The company registered a total income of Rs. 1,254.51 crores for the financial year 2020 as opposed to Rs. 1,266.77 crores last year. Its net profit for the same fiscal year was Rs. 46.13 crores in comparison to Rs. 118.46 crores the previous year.
The total debt of Chemplast as of December 2020 is Rs. 1,187.58 crores. It had issued NCDs worth Rs. 1,270 crores in December 2019 with a coupon of 17.5% per annum. The company has 7 years to repay the amount.
However, it aims to use the proceeds from the IPO for the early redemption of the debentures in full. This will help the company decrease its outstanding debt and keep a suitable debt to equity ratio.
HDFC Bank will act as the global coordinator for the issue. YES Securities, ICICI Securities, Bob Capital Markets, and IndusInd Bank have been appointed to manage this issue, while KFin Technologies has been given the charge of being the registrar.
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13 lots or 351 shares
24 August 2021
Both on NSE and BSE
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