Chemcon Speciality Chemicals Ltd is seeking a valuation of Rs 1,245.44 crore ($169.5 million at current exchange rates) via an initial public offering that is smaller than previously planned in the wake of the Covid-19 pandemic.
The company has set a price band of Rs 338-340 per share for its IPO that begins on September 21, with the anchor book for institutional investors opening on Friday. The IPO will close on September 23, the company said.
The IPO comprises a fresh issue of shares worth Rs 165 crore instead of its earlier proposal to raise Rs 175 crore. The IPO will also see Kamalkumar Rajendra Aggarwal and promoter group individual Naresh Vijaykumar Goyal sell a total of 4.5 million shares as compared with 4.3 million shares (2.15 million each) proposed earlier.
The total IPO size is pegged at Rs 318 crore, including the secondary share sale, at the upper end of the price band. The offer will result in roughly 25.53% stake dilution on a post-issue basis.
Vadodara-based Chemcon had filed its draft prospectus with Securities and Exchange Board of India in August last year. It received SEBI’s green signal in January this year. It was looking to raise about Rs 350 crore earlier at an estimated valuation of around Rs 1,450-1,500 crore.
Merchant bankers Intensive Fiscal Services and Ambit Capital are managing and arranging the share sale.
Chemcon makes speciality chemicals for the pharmaceutical and oilfield industries. It said in its draft red herring prospectus that it is the only manufacturer of hexamethyldisilazane (HMDS) and zinc bromide in India.
The company said it is the world’s eighth-largest maker of HMDS, a chemical compound used in the pharmaceutical and semiconductor industries. It is also the largest producer of chloromethyl isopropyl carbonate (CMIC) and calcium bromide in India. CMIC is a pharmaceutical intermediate while calcium bromide is used in the oilfields industry.