Life sciences company Tarsons Products saw a tepid debut on the bourses as the stock was listed with a 5.74 percent premium on November 26. This is the 52nd company to list on the mainboard in 2021.
Tarsons Products stock opened at Rs 700 on the BSE, while the opening price on the National Stock Exchange was Rs 682.
The labware products maker’s maiden public offer had a strong subscription of 77.49 times. Non-institutional investors had bought shares 184.58 times the portion set aside for them and qualified institutional investors put in bids 115.77 times their quota. The portion set aside for retail investors was booked 10.56 times and that of employees was subscribed 1.83 times.
The company mobilised Rs 1,023.47 crore through its public offer that was composed of a fresh issue of Rs 149.63 crore and an offer-for-sale of Rs 873.84 crore by promoters, and investor Clear Vision Investment Holdings Pte Limited.
The fresh issue proceeds after issue expenses will be utilised for repaying debts and capital expenditure for the new manufacturing facility at Panchla, West Bengal. The offer had a price band of Rs 635-662 per equity share.
Click Here To Know All IPO Related News
Tarsons manufactures a diverse range of labware products used in research organisations, academic institutes, pharmaceutical firms, diagnostic laboratories and hospitals. It supplies products to over 40 countries in both developed and emerging markets, which accounted for 33 percent of its revenue from operations in FY21.
The company had a consolidated profit of Rs 68.87 crore on a revenue of Rs 228.91 crore in FY21, while on a quarterly basis, its consolidated profit was at Rs 24.83 crore on a revenue of Rs 69.15 crore in the quarter ended June 2021.
The public issue had a ‘subscribe’ rating from all the brokerages, given the healthy profit margin, strong management team, leading the Indian supplier to life sciences sector with strong brand recognition.
“The company is a leading supplier to life sciences sector, with diverse range of labware products across varied customer segments in an industry which has a large addressable market. It has high profit margins and also reported return on net worth of 28.19 percent in FY21. However, valuation is on the higher side and, hence, we give this IPO a ‘subscribe (long term)’ rating,” said Hem Securities.
Anand Rathi also recommended ‘subscribe’ to the issue. “The company is well-equipped and automated manufacturing facilities with geographic reach through strong sales and distribution network has experienced promoter, backed by a strong management team,” it said.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.