Laxmi Organic Industries Limited IPO all Details
Incorporated in 1989, Laxmi organic is a leading manufacturer of Acetyl & Specialty Intermediates. It has almost three decades of experience in the large-scale manufacturing of chemicals. Laxmi organic has almost 30% of the market share of Indian ethyl acetate and is the only manufacturer of diketene derivatives in India.
Its products are divided into two broad categories Acetyl Intermediates and Specialty Intermediates. Acetyl Intermediates include acetaldehyde, ethyl acetate, fuel-grade ethanol, and other proprietary solvents. Specialty Intermediates include ketene, diketene derivatives namely acetic anhydride, amides, esters, arylides, and other chemicals.
Its products find space in various high-growth industries such as agrochemicals, pharmaceuticals, dyes & pigments, paints, inks & coatings, flavors & fragrances, printing & packaging, adhesives, and other industrial applications. The company also proposes to diversify into the manufacturing of specialty fluorochemicals.
The company has expanded its scale of operations and global footprint to customers in 30 countries which include Russia, China, Netherlands, Singapore, United Kingdom, United Arab Emirates, and the United States of America.
It has established long-standing relationships with marquee customers which include Alembic Pharmaceuticals Limited, Syngenta Asia Pacific Pte. Ltd., Covestro (India) Private Limited, Flint Group India Private Limited, Dr. Reddy’s Laboratories Limited, Hetero Labs Limited, Granules India Limited, Hubergroup India Private Limited, Heubach Colour Private Limited, Laurus Labs Limited, Huhtamaki India Limited, Mylan Laboratories Limited, Macleods Pharmaceuticals Private Limited, Parikh Packaging Private Limited, Suven Pharmaceuticals Limited, Neuland Laboratories Limited, UPL Limited, and Colourtex Industries Private Limited.
The promoters of the company are Yellow Stone Trust and Mr. Ravi Goenka.
Strengths of the company:
- Laxmi organic is a leading manufacturer of ethyl acetate and has a significant market share.
- It is the only manufacturer of diketene derivatives in India.
- It has one of the largest portfolios of diketene products.
- The company has a diversified customer base across industries and long-standing relationships with marquee customers.
- It has strategically located manufacturing facilities, supply chain efficiencies, and vertical integration.
- The company has in-house R&D capabilities and a consistent track record of technology absorption.
- It has a global presence and low geographical concentration.
- Differentiated business model, product mix, asset base, and strong experience in handling complex chemistries create high entry barriers.
- It has a qualified & experienced promoter, board of directors, and key managerial personnel.
Purpose of the IPO:
- For the investment in the YFCPL for the financing of capital expenditure to set up a proposed facility.
- For the funding of the YFCPL working capital requirements.
- To fund the capital expenditure for the expansion of the SI Manufacturing Facility.
- To meet the working capital requirements.
- To purchase the plant & machinery for infrastructure development at their SI Manufacturing Facility.
- To repay or prepay the outstanding borrowings of the company or their wholly-owned subsidiary.
- To meet the general corporate purposes
Financial Performance of the company:
| For the six-month period ended 30th September 2020 | FY 2020 | FY 2019 | FY 2018 | |
| Total Revenue | 814.35 | 1,538.62 | 1,574.32 | 1,396.07 |
| Total Expenses | 758.15 | 1,483.48 | 1,476.26 | 1,282.77 |
| Profit After Tax | 45.48 | 70.21 | 72.39 | 75.69 |
| Total Assets | 1,037.13 | 1,070.63 | 1,014.48 | 894.73 |
*All the values are in crores and as per DRHP.
Valuation of the company:
| For the six-month period ended 30th September 2020 | FY 2020 | FY 2019 | FY 2018 | |
| Basic Earnings per Share (EPS) | 2.02 | 2.86 | 2.89 | 3.03 |
| Diluted Earnings per Share (EPS) | 2.02 | 2.86 | 2.89 | 3.03 |
| Return on Net Worth (%) | 9.65% | 16.45% | 16.13% | 20.01% |
| Net assets value per Equity share | 20.99 | 18.97 | 17.98 | 15.16 |
*as per DRHP.
IPO details:
| Face Value | ₹2 per equity share |
| Market Lot | 115 Shares |
| Minimum Order Quantity | 115 Shares |
| Price Band | ₹129 - ₹130 per equity share |
| Issue type | Book Built Issue IPO |
| Issue Size | ₹600 Crores |
| Fresh Issue | ₹300 Crores |
| Offer for Sale | ₹300 Crores |
| Listing | NSE, BSE |
Important IPO dates:
| Open Date | 15th March 2021 |
| Close Date | 17th March 2021 |
| Basis of Allotment Date | 22nd March 2021 |
| Initiation of Refunds | 23rd March 2021 |
| The credit of shares to Demat Account | 24th March 2021 |
| Listing Date | 25th March 2021 |
Allocation Quota:
| Category | Portion |
| Qualified Institutional Buyers (QIBs) | Not more than 50% |
| Non- Institutional Buyers (NIIs) | Not less than 15% |
| Retail Investors | Not less than 35% |
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