Anupam Rasayan India Ltd. IPO

IPO Details:

Price Band: 553-555

Cutoff Price: 555

About Company:

One of the leading companies engaged in the custom synthesis and manufacturing of specialty chemicals in India. Anupama have commenced business as a partnership firm in 1984 as a manufacturer of conventional products and have, over the years, evolved into custom synthesis and manufacturing of life science related specialty chemicals and other specialty chemicals, which involve multi-step synthesis and complex technologies, for a diverse base of Indian and global customers. Key focus in our custom synthesis and manufacturing operations is developing in-house innovative processes for manufacturing products requiring complex chemistries and achieving cost optimization.

Company have two distinct business verticals:

1. Life science related specialty chemicals comprising products related to agrochemicals, personal care and pharmaceuticals

2. Specialty chemicals, comprising specialty pigment and dyes, and polymer additives

In Fiscal 2020 and in the nine months ended December 31, 2020, revenues from life science related specialty chemicals vertical accounted for 95.37% and 93.75%, respectively, of revenue from operations, while revenue from other specialty chemicals accounted for 4.63% and 6.25%, respectively, of revenue from operations, in such periods.

Competitive Strengths:

1. Strong and long-term relationships with diversified customers across geographies with significant entry barriers

2. Core focus on process innovation through consistent research and development, value engineering and complex

3. Diversified and customized product portfolio with a strong supply chain

4. Automated manufacturing facilities with strong focus on environment, sustainability, health and safety measures

5. Consistent track record of financial performance

6. Experienced promoters and strong management team

Strategies:

1. Continue to focus on custom synthesis and manufacturing by developing innovative processes and value engineering

2. Expand business by capitalizing on industry opportunities and organic and inorganic growth

3. Diversify product portfolio and expand chemistry expertise

4. Continue to focus on cost efficiency and improving productivity

Financial Performance:

Blue Bar is Revenue, Red Bar is Net Profit, Yellow Bar is EPS

Company's EPS is quite stable throughout without any growth YoY although their revenue and net profit had increased.

Objects of the Issue:

1. Repayment/prepayment of certain indebtedness availed by the Company

2. General corporate purposes

Our view: With EPS of Rs 6.94, company cutoff price is valued at P/E of 80 which is a sort of overvalued. Also, the object of the issue is kept vague by the company and it will be decided post issuing and listing of the share. Despite all this company possess Grey Market Premium (GMP) of around 56% (current) which is good for listing gains. Personally I am applying for the IPO for listing gains only.

Do visit this blog and the link after 6pm to get updated details on grey market premium and subscription details.

Grey Market Premium:

Subscription Details:

Allotment Status: Link

Listing Status:

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