Heranba IPO: Key Details
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Company Information
Heranba Industries Limited, incorporated in 1996 , is a crop protection chemical manufacturer, exporter and marketing company based out of Vapi, Gujarat. It manufactures Intermediates, Technicals and Formulations. It is one of the leading domestic producers of synthetic pyrethroids like cypermethrin, alphacypermethrin, deltamethrin, permitherin, lambda cyhalothrinetc.
It has diversified its business from manufacturing and selling of Intermediates to manufacturing, marketing and selling of Technicals and Formulations. Majority of its current Intermediates production is utilized for captive consumption for the manufacturing of Technicals Products. Formulations are produced and packaged in powder and liquid forms and sold to distributors for further sales to farmers.
Key business verticals include:
- Domestic Institutional sales of Technicals: manufacturing and selling of Technicals in bulk to domestic companies;
- Technicals exports: Exports of Technicals in bulk to customers outside India;
- Branded Formulations: Manufacturing and selling of Formulations under our own brand through distribution network presence in India;
- Formulations Exports: Export of Formulations in bulk and customer specified packaging outside India; and
- Public Health: Manufacturing and selling of general insect control chemicals by participating in the public health tenders issued by governmental authorities and selling to pest management companie
Competitive Strengths
- Presence in a wide range of products across the entire value chain of synthetic pyrethroids
- Product registrations in the domestic and international markets enabling global outreach
- Strong product portfolio and wide distribution network
- Diversified and stable customer base
- Experienced Promoters and Management Team
Company Strategy
- Enhancing and streamlining production capacities and operations
- Development of new products at the R&D facility at Unit III (Sarigam)
- Entering the highly regulated markets of USA and Europe
- Enhancing Formulations & Technicals business in the international markets
- Branded Formulations and Public Health products segment
Proceeds from Fresh Issue of Heranba IPO will be used to:
- To fund working capital requirements
- To fund expenditures towards general corporate purposes.
The object of the Offer for Sale is to allow the Selling Shareholders to sell an aggregate 90,15,000 of Equity Shares subject to finalization of Basis of Allotment held by them.
Heranba IPO: Financials
| 2018 | 2019 | 2020 Mar | 2020 Sep | |
|---|---|---|---|---|
| Revenue from Ops | 7,45.10 Cr | 1,004.44 Cr | 951.37 Cr | 618.34 |
| Profit before Tax | 76.31 Cr | 122.12 Cr | 128.84 Cr | 90.08 |
| Profit after Tax | 46.88 Cr | 75.40 Cr | 97.75 Cr | 66.31 |
| EPS (Basic) | 12 | 19.31 | 25.03 | 16.98 |
Price to Earnings Peer Comparison
| Company | 2020 EPS* | P/E^ |
|---|---|---|
| Heranba | 25.03 | 25.04 |
| Punjab Chemicals | 8.77 | 97.23 |
| Bharat Rasayan | 371.03 | 26.87 |
| Sector P/E | – | 48.58 |
Heranba IPO Dashboard
Issue Details
| Type | Value |
|---|---|
| Issue Size | ₹685.24 Cr |
| Fresh Issue | ₹60 Cr |
| Offer for Sale | ₹625.24 Cr |
| Face Value | ₹10/- per Equity Share |
| IPO Price | ₹626 – ₹627 |
| Lot Size | 23 shares |
| Lots | Min 1 – Max 13 |
Key Dates
| Date Type | Date |
|---|---|
| Bid Open | 23/02/2021 |
| Bid Close | 25/02/2021 |
| Allotment Finalization | 02/03/2021 |
| Initiation of Refunds | 03/03/2021 |
| Credit of Shares | 04/03/2021 |
| Listing Date | 05/03/2021 |
Lot Size and Price
| Lots | Shares | Amount |
|---|---|---|
| 1 | 23 | ₹14,421 |
| 13 | 299 | ₹1187,473 |
Promoter Holding
| Holding | Percentage |
|---|---|
| Pre-Issue | 98% |
| Post-Issue | 74% |
Heranba IPO: Investor Quota and Shares Offered
| Investor Type | Quota | Shares on Offer |
|---|---|---|
| QIB | 50% | 19,95,448* shares |
| NII | 15% | 14,95,791 shares |
| RII (Retail) | 35% | 34,90,178 shares |
| Total | 100% | 69,81,417 shares |
Heranba IPO: Risks
- There are outstanding legal proceedings involving the Company, its Promoters and certain Directors which may adversely affect the business, financial condition and results of operations
- Absence of large customers and dependence on smaller customers increases uncertainty of demand which may have an adverse impact on the business operations and financial performance
- Any reduction or loss in sales to institutional customers could have an adverse effect on the business
- Raw materials constitute a significant percentage of the total expenses. Any increase in prices and any decrease in the supply would materially adversely affect the business
- The Company had negative cash flows in recent fiscals. Sustained negative cash flow could adversely impact the business
For complete internal and external risk factors, you can refer the RHP of the company.
Heranba IPO: Registrar and Lead Managers
Registrar of the Issue
Bigshare Services Private Limited
1st floor, Bharat Tin Works Building, Opp. Vasant Oasis, Makwana Road, Marol, Andheri (East), Mumbai- 400 059, Maharashtra, India
Phone: +91 22 6263 8200
E-mail: [email protected]
Lead Managers of the Issue
Emkay Global Financial Services Limited
Batlivala & Karani Securities India Private Limited
Phone: +91 22 6612 1212 / +91-22-40076000
Email: [email protected] /
[email protected]
