Heranba Industries shares had a strong debut on March 5 as the stock rallied 29.60 percent on the National Stock Exchange despite the market closing in the red for the second consecutive session.
The stock closed at Rs 812.60 against the issue price of Rs 627, with volume of over 1.65 crore equity shares. It touched an intraday high of Rs 945 and low of Rs 796.55.
On the BSE, the stock rose 29.55 percent to close at Rs 812.25 after hitting the day's high of Rs 944.95 and low of Rs 796.35, with volume of 17.15 lakh equity shares.
Heranba Industries opened with gains of 43.5 percent at Rs 900 on both the exchanges.
Heranba Industries, a crop protection chemical manufacturing company, had raised Rs 625 crore through the public issue which was subscribed 83 times.
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The company is one of the leading domestic producers of synthetic pyrethroids, where it enjoys a 19.5 percent market share. It derives 50 percent of the revenue from the export market, where it enjoys higher margin.
"The export demand would continue to be strong as the shutdown of several chemical plants in China would result in higher volumes of pyrethroids being exported out of India," said Hemang Jani, Head Equity Strategy, Broking & Distribution at Motilal Oswal Financial Services. Pyrethroids are synthetic insecticides.
Heranba has 371 registrations in the international market, while 172 are awaiting approval. The crop protecting chemical maker is also in the process of developing two fungicides, two herbicides and an insecticide exclusively for European markets.
It also has a well-diversified presence in India through more than 9,400 dealers and distributors. During FY18-20, its revenue witnessed a 13 percent CAGR, while PAT grew at a 44 percent CAGR, led by EBITDA margin expansion from 12.5 percent in FY18 to 15.3 percent in FY20. Return on equity has been consistent and healthy at around 30 percent.