Citichem India Limited, a prominent player in the chemical manufacturing sector, has announced its Initial Public Offering (IPO). The IPO will be open for subscription from December 27, 2024 to December 31, 2024 and will be listed on BSE SME platform. The IPO is entirely a fresh issue and the company plans to raise Rs 12.60 crore from the IPO.
Company Overview
Citichem India, established in the year 2005, specializes in producing specialty chemicals that find applications in diverse industries, such as pharmaceuticals, agrochemicals, and textiles. Research and development are strong elements in the company, where a wide range of diversified products has been developed for both domestic and international markets.
Objectives of the Issue
The proceeds from the issue will be used for the following purposes:
- Manufacturing Facilities: Increase in capacity to meet the growing demand.
- Debt Repayment: Reduce the company’s debt to strengthen the balance sheet.
- General Corporate Purposes: To support day-to-day operations and future growth initiatives.
Citichem India Limited – Financial Performance
Revenue from Operations:
FY 2023: ₹2,094.07 lakh
FY 2024: ₹1,960.58 lakh
Profit After Tax (PAT):
FY 2023: ₹36 lakh
FY 2024: ₹111.83 lakh
Earnings Per Share (EPS):
FY 2023: ₹0.72
FY 2024: ₹2.24
Citichem India Limited – Financial Ratios
Debt-to-Equity Ratio:
FY 2024: 0.15
Return on Equity (ROE):
FY 2024: 15.42%
Return on Capital Employed (ROCE):
FY 2024: 21.47%
PAT Margin:
FY 2024: 5.70%
Observations:
- The company experienced a 6% decline in revenue from FY 2023 to FY 2024.
- Despite the revenue decline, the PAT of the company increased by 208%, indicating improved profitability.
- The EPS saw a significant rise from ₹0.72 in FY 2023 to ₹2.24 in FY 2024, reflecting enhanced earnings per share.
- The company’s debt-to-equity ratio stands at a low 0.15, suggesting prudent financial management.
- Healthy ROE and ROCE figures indicate efficient utilization of equity and capital resources.
Industry Outlook
The specialty chemicals industry in India is expected to witness significant growth, driven by increasing demand from end-user industries and a shift towards sustainable products. Citichem India’s focus on innovation positions it well to capitalize on these trends.
Citichem India IPO – Risk Factors
Potential investors should consider the following risks:
- Market Competition: Intense competition from domestic and international players.
- Regulatory Changes: Stringent environmental regulations could impact operations.
- Raw Material Costs: Raw material price volatilities can have implications on profit margins.
Citichem India Limited IPO Details
| IPO Name | Citichem India |
| Issue Type | Fresh Issue |
| IPO Open Date | December 27, 2024 |
| IPO Close Date | December 31, 2024 |
| Price Band | ₹ 70 per share |
| Lot Size | 2000 shares per lot |
| Retail Investors Min lot and Amount | 1 lot & ₹1,40,000 |
| Retail Investors Max lot and Amount | 1 lot & ₹1,40,000 |
| HNI Min lot and Amount | 2 lots & ₹2,80,000 |
| Issue Size | 12.60 crores |
| Basis of Allotment | January 1, 2025 |
| Listing Date | January 3, 2025 |
| Listing Exchange | BSE SME |
| Retail Individual Investors (RII) Quota | 47.44% |
| Non – Institutional Investors (NII/HNI) Quota | 47.44% |
| Market Makers Quota | 5.11% |
Citichem India Limited IPO Subscription Status
Citichem India Limited IPO on day 3 (December 31, 2024) was subscribed 414.35 times. In the retail investors category the IPO was subscribed 543.18 times, while in the NII category it was subscribed 277.88 times.
Citichem India Limited IPO GMP
As per various sources tracking the IPO, the latest GMP of Citichem India is ₹30. Considering issue price of ₹70, and the GMP of ₹30, the IPO is expected to list at ₹100 a gain of 42.85%.
Citichem India Limited IPO Allotment Status
The registrar for the IPO is Kfin Technologies Limited. The allotment status can be check by visiting the website of the registrar.
Citichem India Limited Listing Date
The company is expected to be listed on January 3, 2025.
Conclusion
Citichem India IPO is a promising investment avenue, supported by strong financials and a strategic growth plan. However, potential investors need to do their due diligence, consider market risks before deciding to investment.
Happy IPO Investing!
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