Laxmi Organic IPO: Key Details
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Company Information
Laxmi Organic Industries Limited, incorporated in 1989, is the leading manufacturer of Acetyl Intermediates and Specialty Intermediates with almost three decades of experience in large scale manufacturing of chemicals. It is currently among the largest manufacturers of ethyl acetate in India with a market share of approximately 30% of the Indian ethyl acetate market.
Company’s products are currently divided into two broad categories, namely
- Acetyl Intermediates and the Specialty Intermediates. The Acetyl Intermediates include ethyl acetate, acetaldehyde, fuel-grade ethanol and other proprietary solvents, while
- Speciality Intermediates comprises of ketene, diketene derivatives namely esters,
acetic anhydride, amides, arylides and other chemicals.
Competitive Strengths
- Leading manufacturer of ethyl acetate with a significant market share
- Only Indian manufacturer of diketene derivatives with a significant market share and one of the largest portfolios of diketene products
- Diversified customer base across high growth industries and long-standing relationships with marquee customers
- Strategically located manufacturing facilities, vertical integration and supply chain efficiencies
- In-house research and development capabilities and consistent track record of technology absorption
- Differentiated business model, asset base, product mix and experience in handling complex chemistries create high entry barriers
Company Strategy
- Volume maximisation at Manufacturing Facilities by expanding installed capacities to support growth initiatives
- Expanding and optimising its product portfolio
- Increasing the global footprint and augmenting growth in current geographies
- Establishing fluorospecialty chemicals business
- Continuing focus on innovation and leveraging chemistries and technology absorption
Proceeds from Laxmi Organic IPO will be used to:
- Investment in the wholly-owned Subsidiary, Yellowstone Fine Chemicals Private Limited (“YFCPL”) for part-financing its capital expenditure requirements
- Investment in YFCPL for funding its working capital requirements;
- Funding capital expenditure requirements for expansion of SI Manufacturing Facility (
- Funding working capital requirements of the Company
- Purchase of plant and machinery for augmenting infrastructure development at SI Manufacturing Facility
- Prepayment or repayment of all or a portion of certain outstanding borrowings availed by the Company and its wholly-owned Subsidiary, Viva Lifesciences Private Limited
- General corporate purposes
Laxmi Organic IPO: Financials
| 2018 | 2019 | 2020 Mar | 2020 Sep | |
|---|---|---|---|---|
| Revenue from Ops | ₹1,393.07Cr | ₹1,568.52 Cr | ₹1,534.12 Cr | ₹814.35 Cr |
| Profit before Tax | ₹113.31 Cr | ₹97.59 Cr | ₹55.14 Cr | ₹56.20 Cr |
| Profit after Tax | ₹75.70 Cr | ₹72.39 Cr | ₹70.21 Cr | ₹45.48 Cr |
| EPS (Basic) | 3.03 | 2.89 | 2.86 | 2.02 |
| As of March 2020 | EPS | P/E (Floor) | P/E (Cap) |
|---|---|---|---|
| Based on basic EPS | 2.86 | 45.45 | 45.10 |
Comparison with listed industry peers
| Company | EPS | P/E (Cap) |
|---|---|---|
| Laxmi Organic | 2.86 | 45.10 |
| Vinati Organics | 32.48 | 44.85 |
| Sector Average | – | 39.23 |
Laxmi Organic IPO Dashboard
Issue Details
| Type | Value |
|---|---|
| Issue Size | ₹600 Cr |
| Fresh Issue | ₹300 Cr |
| Offer for Sale | ₹300 Cr |
| Face Value | ₹2/- per Equity Share |
| IPO Price | ₹129 – ₹130 |
| Lot Size | 115 shares |
| Lots | Min 1 – Max 13 |
Key Dates
| Date Type | Date |
|---|---|
| Bid Open | 15/03/2021 |
| Bid Close | 17/03/2021 |
| Allotment Finalization | 22/03/2021 |
| Initiation of Refunds | 23/03/2021 |
| Credit of Shares | 24/03/2021 |
| Listing Date | 25/03/2021 |
Lot Size and Price
| Lots | Shares | Amount |
|---|---|---|
| 1 | 115 | ₹14,950 |
| 13 | 1495 | ₹1,94,350 |
Promoter Holding
| Holding | Percentage |
|---|---|
| Pre-Issue | 89.51% |
| Post-Issue | 72.92% |
Laxmi Organic IPO: Investor Quota and Shares Offered
| Investor Type | Quota | Shares on Offer |
|---|---|---|
| QIB | 50% | 93,02,324* |
| NII | 15% | 69,76,744 |
| RII (Retail) | 35% | 1,62,79,070 |
| Total | 100% | 3,25,58,138 |
Laxmi Organic IPO: Risks
- A large part of its manufacturing facilities are located in one geographic area and therefore, any localized social unrest or natural disaster could have a material adverse effect
- Any inability to manage the growth or implement its strategies effectively could have a material adverse effect on its business, results of operations and financial condition
- Any increase in the cost of raw material or other purchases or a shortfall in the supply of raw materials may adversely affect the pricing and supply of its products
- A significant portion of the revenues and expenses and certain borrowings are denominated in foreign currencies.
- Company’s profitability largely depends upon the global prices. There is no assurance that the prices may sustain or further increase in the future.
For complete internal and external risk factors, you can refer the RHP and DRHP of the company.
Laxmi Organic IPO: Registrar and Lead Managers
Registrar of the Issue
Link Intime India Private Limited
C-101, 1st floor, 247 Park
L. B. S. Marg, Vikhroli West
Mumbai 400 083, Maharashtra, India
Phone:(91 22) 4918 6200
Email: [email protected]
Lead Managers of the Issue
Axis Capital Limited
DAM Capital Advisors Limited
Phone: +91-22-4325 2183 / +91-22-4646 4600
Email: [email protected] / [email protected]
