Dorf Ketal Chemicals plans Rs 5,000-crore IPO, files draft papers with SEBI

Dorf-Ketal Chemicals intends to utilise Rs 1,162 crore out of fresh issue proceeds mainly for repaying debt availed by itself and subsidiary Dorf Ketal Chemicals FZE

Specialty chemicals maker Dorf-Ketal Chemicals India is planning to tap capital markets to raise Rs 5,000 crore via initial public offering. It has filed preliminary papers with the capital markets regulator SEBI.

The IPO comprises of fresh issuance of equity shares worth Rs 1,500 crore, and an offer-for-sale of Rs 3,500 crore worth shares by promoter Menon Family Holdings Trust.

The company that caters to hydrocarbons and industrial supply chains (including the oil and gas, refining and petrochemicals industries) may consider raising funds of Rs 300 crore in a pre-IPO round. If it manages to complete this pre-IPO placement, the fresh issue will get reduced to the extent of such amount.

Dorf-Ketal Chemicals intends to utilise Rs 1,162 crore out of fresh issue proceeds mainly for repaying debt availed by itself and subsidiary Dorf Ketal Chemicals FZE. The remainder funds will be used for general corporate purposes.

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As of October 2024, on a consolidated basis, the total outstanding borrowings on its books were Rs 3,540.8 crore.

Established in 1992, Dorf-Ketal Chemicals through its 16 manufacturing facilities in four countries (including eight in India) offers products in two categories - specialty chemicals for hydrocarbons, and industrial specialty chemicals which accounted for 81 percent and 19 percent, respectively, to total revenue in last financial year as well as in the first half of current financial year (FY25).

It supplies specialty chemicals products to some of marquee names in the hydrocarbons and industrial segments including Reliance Industries, Petronas, Indian Oil Corporation, PPG Industries, Clariant, Liberty Energy, Italiana Petroli, and Vedanta. It had 1,322 customers by the end of September 2024.

Mumbai-based Dorf-Ketal Chemicals has recorded healthy financial performance in the past years with profit in the fiscal 2024 growing sharply by 33.4 percent to Rs 602 crore and revenue rising 41.7 percent to Rs 5,479.5 crore compared to previous fiscal 2023. Profit in six months period ended September 2024 stood at Rs 231.6 crore on revenue Rs 2,961.4 crore.

The company has appointed six merchant bankers - JM Financial, Citigroup Global Markets India, HSBC Securities and Capital Markets (India), JP Morgan India, Morgan Stanley India Company, and Motilal Oswal Investment Advisors - to handle its big public issue.

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