Mumbai-based speciality chemicals firm Rossari Biotech kickstarted its initial public offer today, July 13, ending the nearly four-month dry streak for IPOs in the domestic markets. SBI Cards & Payment Services was the last company that got listed in the market in mid-March.
Here are 10 things you need to know about the issue:
-- Issue date: The issue opened on July 13 and will close on July 15.
-- Price band: The price band is of Rs 423-Rs 425/share. Each share will have a face value of Rs 2 with bid lots available in 35 shares and in multiples thereof.
-- Issue size: The issue size is pegged around Rs 494-Rs 496 crore. The IPO will consist of a fresh issue of equity shares aggregating up to Rs 50 crore and an offer for sale component of up to 10,500,000 equity shares.
-- Purpose: The proceeds from the IPO will be used to primarily repay debt and fund working capital requirements, along with general corporate purposes.
-- Listing date: Based on the indicative timeline, trading is likely to commence on July 23.
-- Merchant bankers: Axis Capital and ICICI Securities are the book running lead managers for the IPO and Axcelus Finserv Private Limited is the adviser to the offer.
-- About the company: Rossari Biotech’s business is organised in three main product categories –a) home, personal care and performance chemicals (HPPC);
b) textile specialty chemicals;c) animal health and nutrition products (AHNP).
As on May 31, 2020, it had a range of 2,030 different products sold across these categories. The products are used in the manufacture of soaps and detergents, paints, inks, tiles, papers, natural and man-made textiles.
HUL, IFB Industries & Arvind Ltd are some of its key customers and the firm counts Aarti Industries, Galaxy Surfactants, Atul Ltd, Vinati Organics & Fine Organics Industries as some of its listed peers.
Apart from India, it has operations in 17 countries, including Vietnam, Bangladesh and Mauritius.
-- Financials: In fiscal 2020, Rossari Biotech registered total revenue of Rs 603.82 crore, EBITDA of Rs 104.53 crore and net profit after tax of Rs 65.25 crore.
The revenue from sale of HPPC constituted 46.81 percent of the total revenue in fiscal 2020, textile specialty chemicals constituted 43.71 percent and the rest came from the animal health and nutrition products category.
The firm has been able to increase the total revenue from fiscal 2018 to fiscal 2020 at a CAGR of 41.65 percent, EBITDA at a CAGR rate of 56.58 percent and the profit after tax has increased at a CAGR of 60.27 percent over the same period.
-- Promoter holding: Edward Menezes and Sunil Chari are the promoters of the company. They hold 42.10 percent and 42.05 percent stake as, respectively, while the public shareholding stands at 4.9 percent.
-- Pre-IPO placements: Rossari Biotech on Friday said it has raised Rs 149 crore from anchor investors. The anchor investors include Abu Dhabi Investment Authority, HDFC Mutual Fund, Axis Mutual Fund, ICICI Prudential Mutual Fund, SBI Mutual Fund, Sundaram Mutual Fund, HDFC Life Insurance Company and Goldman Sachs India.
In a statement, the company said it has raised Rs 148.87 crore in anchor allotment and has finalised allocation of 35,02,940 shares to 15 institutional investors at Rs 425 per share, which is the upper limit of the price band for the IPO.As per company's red herring prospectus (RHP), the company had previously raised Rs 100 crore in a pre-IPO placement in March with Malabar India Fund, White Oak, Kotak Infina, Axis AMC, Mirae Asset, Sundaram Mutual Fund, IIFL and ICICI Lombard General Insurance.