Incorporated in 1988. Chemcon Speciality Chemicals Ltd is a manufacturer of specialized chemical products such as HMDS and CMIC. Not only oilfield chemicals such as Calcium Bromide, Sodium Bromide, and Zinc Bromide but also Pharma intermediates, Silanes, and chemical contract manufacturing work is also included in their portfolio. The article is about Chemcon Speciality Chemicals IPO Review.
About the Chemcon Speciality Chemicals
Chemcon Chemicals is a leading manufacturer of Pharmaceutical chemicals. The company generates maximum revenue from this particular segment. All the big cap companies such as Hetero Labs Limited, Laurus Labs Ltd, Aurobindo Pharma Ltd, Lantech Pharmaceuticals Ltd as well as Macleods Pharma Ltd are the key customers of its Pharma chemical business. In the same way Shree Radha Overseas, Universal Drilling Fluids, Water Systems Speciality are some of the clients of its oilfield chemicals segment. In 2018, it was the 8th largest manufacturer of HMDS and the second-largest manufacturer of CMIC chemicals worldwide.
The company not only serves the domestic market but also export its products in overseas markets such as the USA, China, Japan, UAE, Serbia, Russia, Malaysia, and Azerbaijan also. It has a manufacturing plant at Manjusar near Vadodara in Gujarat besides that 5 operational plants as well. The company also owns 3 warehouses, and 2 leased warehouses also.
Competitive strengths of the Chemcon Speciality Chemicals ltd
The company has some important aspects which provide them strenth in India as well as globally. In the following list, we shall check on that
- The Chemcon Speciality Chemicals Ltd is among the largest manufacturer of pharmaceutical chemicals in India as well as across the globe.
- This company is India’s leading oilfield chemicals manufacturer as well as quite populer among the big cap companiues.
- The company diversified clientele base in the domestic and also in the global markets.
- Strong and consistent financial performance in one of the biggest factor of Chemcon Speciality Chemicals Ltd.
- Dedicated manufacturing plants for each product.
Company Promoters:
Promoters are those persons who initially start the company or put their money as an investment at the company. In this scenario, if the company do well then the profit will be divided among them. Otherwise, if the company sinks their money will sink with it. In the Chemcon Speciality Chemicals ltd KamalKumar Rajendra Aggarwal, Navdeep Naresh Goyal, and Shubharangana Goyal are the promoters of the company. They put their money and sweat to make it one of the leading companies of India. They also extend their branches globally.
Chemcon Speciality Chemicals Financials:
| Particulars | For the year/period ended (₹ in million) | |||
|---|---|---|---|---|
| 31-Mar-20 | 31-Mar-19 | 31-Mar-18 | 31-Mar-17 | |
| Total Assets | 2,257.92 | 1,730.33 | 970.66 | 626.80 |
| Total Revenue | 2,660.17 | 3,053.26 | 1,583.91 | 899.96 |
| Profit After Tax | 488.53 | 430.41 | 263.81 | 28.24 |
After analysing the company’s financials it’s quite clear that the company is a black horse of its field. The company is growing more and more and also spreading its roots on the oilfield ground.
Objects of the Issue:
Firm purposes to utilize the net proceeds from the IPO towards below objectives;
• To meet capital expenditures for expansion of manufacturing facility.
• To meet business working capital requirements.
• To meet general corporate purposes.
Chemcon IPO Details
| IPO Date | Sep 21, 2020 – Sep 23, 2020 |
| Issue Type | Book Built Issue IPO |
| Issue Size | 9,352,940 Eq Shares of ₹10 (aggregating up to ₹318.00 Cr) |
| Fresh Issue | 4,852,940 Eq Shares of ₹10 (aggregating up to ₹165.00 Cr) |
| Offer for Sale | 4,500,000 Eq Shares of ₹10 (aggregating up to ₹153.00 Cr) |
| Face Value | ₹10 per equity share |
| IPO Price | ₹338 to ₹340 per equity share |
| Market Lot | 44 Shares |
| Min Order Quantity | 44 Shares |
| Listing At | BSE, NSE |
Chemcon IPO Tentative Date / Timetable
| Bid/Offer Opens On | Sep 21, 2020 |
| Bid/Offer Closes On | Sep 23, 2020 |
| Finalisation of Basis of Allotment | Sep 28, 2020 |
| Initiation of Refunds | Sep 29, 2020 |
| The credit of Shares to Demat Acct | Sep 30, 2020 |
| IPO Shares Listing Date | Oct 1, 2020 |
Chemcon IPO Lot Size and Price (Retail)
| Application | Lots | Shares | Amount (Cut-off) |
|---|---|---|---|
| Minimum | 1 | 44 | ₹14,960 |
| Maximum | 13 | 572 | ₹194,480 |
Chemcon IPO Promoter Holding
| Pre Issue Share Holding | 100% |
| Post Issue Share Holding | 74.47% |
Chemcon IPO Offer Size by Investor Category
The Percentage of Offer Size available for Allotment/allocation:
- QIBs: 50%
- Non-Institutional Investors: 15%
- Retail Individual Investors: 35%
Now, finally, come to review. As you can see in the very first the company financials. Here, the previous 3 years’ financial is also given. As per the report, the total asset was moreover 626.80 (FY17), 970.66(FY18), 1,730.33(FY19). Total revenue was 899.96 (FY17), 1,584.72(FY18), and 3,043.16(FY19). Lastly, profit after taxes is 28.24 (FY17), 263.81(FY18), 430.41(FY19). The profit level is moderate to high. Now, from the recommendations of different brokers as well as financial houses, we have checked more than 7 of them. We have found that the first 5 of them asked to SUBSCRIBE and the last 3 of them maintained a NEUTRAL rating. Hence while doing the Chemcon Speciality Chemicals IPO Review, based on the above data and the company financials, we also maintain a SUBSCRIBE rating on the issue. But make sure you check the IPO on the final day of applying with our special checking method.
