Paragon Fine and Speciality Chemical off to a flyer, lists at 125% premium over issue price

Gains in the market were broad based as all sectors traded in the green.

Paragon Fine and Speciality Chemical made a stellar debut, listing at a 125 percent premium over the IPO price on November 3. The stock opened at Rs 225 against the issue price of Rs 100 on the NSE SME platform.

At 10.35 am, the stock was trading at Rs 213.75, up 113.75 percent from the offer price. The initial public offering (IPO ), which was open for subscription from October 26 to October 30, was subscribed 205 times.  The price band for the offer was Rs 95-100 a share.

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The company raised Rs 51.66 crore through the IPO, which was a fresh issue of 51.66 lakh shares. The company plans to use the proceeds to fund the construction work at its factory premises in Ahmedabad and for a new plant and machinery.

The small and medium enterprises will also use the funds to bring down the debt by Rs 12.90 crore and to meet working capital requirements.

The Ahmedabad-based speciality, cosmetics, and pharma intermediate manufacturing company raised Rs 14.7 crore from anchor investors, which included Morgan Stanley, MAIQ Growth Scheme, LC Radiance Fund VCC, Finavenue Growth Fund, and Nova Global Opportunities Fund.

The promoters of the company are Pravinchandra Jasmat Vasolia, Kishorkumar Panchabhai Patolia, Vallabh Ratanji Savaliya, Rutesh Vallabhbhai Savalia and Shivam Kishorbhai Patolia. The book-running lead manager for the issue was Hem Securities, Bigshare Sevices was the registrar and Hem Finlease the market-maker.

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In FY 23, the company’s net profit jumped 120.3 percent on-year to Rs 9.89 crore and revenue grew 23.5 percent to Rs 102.3 crore. The profitability was driven mainly by the operating performance, with the EBITDA (earnings before interest, tax, depreciation and amortisation) increasing by 118.5 percent YoY to Rs 12.83 crore. The margin expanded by 545 basis points to 12.54 percent.

In the June quarter, the company reported a profit of Rs 3.62 crore on revenue of Rs 28.8 crore.