Specialty chemicals manufacturing company Rossari Biotech, which had dared earlier in the day to launch its initial public offering (IPO) on March 18, has decided to postpone the plan given the turmoil in equity markets triggered by the novel coronavirus outbreak.
The company on March 12 has also withdrawn its red herring prospectus available on the National Stock Exchange, after cancelling a press conference planned before opening the IPO.
"We regret to inform you that the Rossari Biotech IPO Press Conference dated March 13, 2020, scheduled in Mumbai stands cancelled due to unfavourable market conditions," the company said in a statement.
Equity markets across the world have witnessed carnage over the past few days owing to the coronavirus outbreak which has cast a shadow over global growth. Indian equities plunged more than 22 percent from their record highs in January after the World Health Organisation declared the outbreak a global pandemic. The virus, which has spread to more than 120 countries, has already claimed 4,700 lives with 1.27 lakh infections.
The grey market premium of SBI Cards and Payment Services also got impacted by the weak market conditions, falling more than 80 percent from its pre-IPO period, while Antony Waste Handling Cell IPO subscription remained unchanged at 50 percent for the third working day despite the company extended its closing date to March 16 and revised price band to Rs 294-300 per share (from Rs 295-300 per share).
Rossari Biotech provides customised solutions to specific industrial and production requirements of customers primarily in the FMCG, apparel, poultry and animal feed industries through diversified product portfolio comprising home, personal care and performance chemicals; textile specialty chemicals; and animal health and nutrition products.
The public issue comprises a fresh issue of Rs 50 crore and an offer for sale of up to 52.5 lakh equity shares each by promoters Edward Menezes and Sunil Chari. The issue was supposed to close on March 20.
Edward Menezes and Sunil Chari hold 42.10 percent and 42.05 percent stake respectively in the company as of now.
The firm proposed to use net fresh issue proceeds for repaying loans and funding working capital requirements. It will not receive any proceeds from the offer for sale.
Axis Capital and ICICI Securities are the book running lead managers to the issue.