Prasol Chemicals files draft papers with SEBI to raise funds via IPO

Speciality Chemicals firm Prasol Chemicals Ltd has filed a draft papers with Securities Exchange Board of India (SEBI) to raise funds via initial public offering.

The IPO comprises a fresh issue of Rs 250 crore and an offer for sale of upto nine million shares by its promoters and existing shareholders.

The OFS consists of upto 1.65 million shares by Usha Rajnikant Shah, upto 8.7 lakh shares by Nishith Rasiklal Dharia, upto 6.30 lakh by Gaurang Natwarlal Parikh, upto 5 lakh shares each by Bhisham Kumar Gupta and Dipti Nalin Parikh.

As per market sources, the company is likely to raise around Rs 700-800 crore.

The proceeds from the issue worth Rs 160 crore will be used to repay debt. As of December 2021, the aggregated outstanding borrowings was at Rs 279.29 crore.

The firm will also use Rs 30 crore for working capital requirements. As of December 2021, its fund based working capital limit stood at Rs 214.82 crore while non fund based limit at Rs 82.70 crore.

The firm is among the leading forward integrated manufacturers of acetone derivatives and phosphorus derivatives in India. Its products have end uses in four segments namely pharmaceuticals, agrochemicals, home and personal care and performance chemicals.

As of December, its global distribution network spread across 45 countries across Asia, North America and the European Union and it had a portfolio of more than 140 specialty products and 32 products which are in the pipeline

For fiscal year 2021, its total income stood at Rs 602.14 crore versus Rs 534.72 crore a year ago. Net profit was at Rs 25.08 crore against Rs 37.77 crore last year.

JM Financial and DAM Capital Advisors Ltd are the book managers to the issue.