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Laxmi Organic Industries IPO opens: Should you subscribe?

Laxmi Organic IPO, at the higher end of price band, on FY20 earnings basis looks expensive compared to peers, the brokerages feel.

March 15, 2021 / 11:23 AM IST
 
 
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Laxmi Organic Industries, a specialty chemicals company, is planning to raise Rs 600 crore through public issue. The IPO, which opened on March 15, comprises a fresh issue of Rs 300 crore and an offer for sale of Rs 300 crore by promoter Yellow Stone Trust.

The issue will close on March 17 and the price band for the offer has been fixed at Rs 129-130 per share.

The company raised Rs 200 crore in pre-IPO placement issue, and mopped up Rs 180 crore from anchor investors.

Net proceeds from the fresh issue and pre-IPO placement will be used for capital expenditure and for working capital requirements of its wholly-owned subsidiary Yellowstone Fine Chemicals (YFCPL). The funds will also be used to purchase plant & machineries for the proposed facility expansion of specialty intermediates division, repayment of some debt and working capital requirement of the company.