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Shares of Dharmaj Crop Guard, whose IPO had received a good response from investors, are likely to see a strong debut. Dharmaj Crop Guard shares are likely to get listed tomorrow. The Initial Public Offer (IPO) of Dharmaj Crop Guard was subscribed 35.49 times, with the 250-crore issue receiving bids for 28,43,51,820 shares against 80,12,990 shares on offer. 

Dharmaj Crop's IPO had a fresh issue of up to 216 crore and an offer for sale of 14,83,000 equity shares. Its price range was 216-237 a share.

Santosh Meena, Head of Research, Swastika Investmart Ltd, said that the Dharmaj IPO's grey market premium indicates a listing gain of around 20%. 

“The industry outlook is bullish as the upward momentum in pesticide industry output is expected to continue going forward, backed by a growth in food consumption in the domestic market amid an expected increase in population, government support for agriculture, demand from export markets, and the horticulture and floriculture markets, among others," he said. 

Speaking on industry growth opportunity, he said: “The penetration of pesticides and agrochemicals in India is low, and this poses an opportunity for growth for agrochemical producers. In addition to this, the government’s aim to reduce dependency on China and improve self-sufficiency is expected to support industry’s backward integration and thus its growth."

On Dharmaj Crop issue, he said that it is priced at 20 PE of FY22 earnings, which is lower than most of its listed peers, and the company has posted steady growth in both revenue and profit. “Profit margins are also rising continuously in a tough environment, and we have seen healthy subscription figures for the IPO, so we are seeing good demand in the grey market. DGCL has been able to develop strong distribution channels and a stable, diversified product portfolio," he said.  

According to Abhay Joshi, co-founder of UnlistedArena, Dharmaj Crop Guard got a decent response to its IPO across all categories due to reasonable price and growth opportunities. “Also, small issue size generated huge demand. Looking at the demand we may expect a good listing and the issue may list over 15-20% premium to its issue price," he said.

The category for non-institutional investors received 52.29 times subscriptions, Qualified Institutional Buyers (QIBs) portion got subscribed 48.21 times, and Retail Individual Investors (RIIs) 21.53 times.

Dharmaj Crop has raised 74.95 crore from anchor investors, including Elara India Opportunities Fund, Rajasthan Global Securities and Resonance Opportunities Fund.

Dharmaj Crop Guard is an agrochemical company engaged in the business of manufacturing, distributing, and marketing a wide range of agro chemicals such as insecticides, fungicides, herbicides, plant growth regulator, micro fertilizers, and antibiotic. (With Agency Inputs)

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