1 min read.Updated: 03 Nov 2021, 11:14 AM ISTLivemint
Sigachi Industries IPO consists of a fresh issue of 7.70 million shares up from earlier planned of up to 2.84 million shares
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Sigachi Industries Ltd initial public offering (IPO), which opened on Monday for subscription, has seen a strong demand. The issue will conclude on 3 November, along with two other issues of Policybazaar and SJS Enterprises. The company has set price band of ₹161-163 a share for its three-day share sale. In the grey market, Sigachi shares were commanding a premium (GMP) of ₹180.
On Day 3 as of 11:10 am, the public issue of microcrystalline cellulose manufacturer Sigachi Industries has received 29.28 times subscription. Qualified institutional buyers (QIBs) category booked 1.36 times, while that of non institutional investors 21.93 times and retail individual investors (RIIs) bid 48.38 times.
“When the D-Street is busy witnessing some giant startup IPOs, the tiny sized IPO too is preparing for its debut. Sigachi is one of the leading manufacturer of MCC. The financial performance looks satisfactory with revenues growing at a CAGR of 22% in last three years. Good top & bottom line growth has been recorded. On the upper band of the issue, the demanding P/E of over 13x looks reasonable. Reasonable pricing and tiny issue size should ensure huge fancy which in turn will lead to heavy subscription," said Abhay Doshi, founder, UnlistedArena.com.
The IPO of the Hyderabad-based manufacturer of cellulose-based excipients, consists of a fresh issue of 7.70 million shares up from earlier planned of up to 2.84 million shares. On the upper end price band, the firm will raise as much as ₹125 crore through its share sale.
The Hyderabad-based firm is engaged in the manufacturing of Microcrystalline Cellulose (MCC) which is widely used as an excipient for finished dosages in the pharmaceutical industry and has varied applications in food, nutraceuticals, and the cosmetic industries.
It carries out its operations from three manufacturing units situated at Hyderabad, Jhagadia, and Dahej in Gujarat.
The proceeds from the issue will be used for expansion of production facilities of MCC at Dahej and Jhagadia in Gujarat. The expansion will add 3,600 MTPA capacity to the Dahej and Jhagadia facility, augmenting its capacity to 7,890 MTPA and 5,760 MTPA, respectively.
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