The company's Rs625 crore initial public offering was subscribed more than 83 times. The IPO comprised an offer-for-sale of up to 90.15 lakh equity shares and a fresh issue of ₹60 crore shares
MUMBAI: Having listed at a 43% premium to the issue, shares of Heranba Industries Ltd closed over 29% higher on Friday.
On the BSE, the stock listed at Rs900 apiece, up from its issue price of Rs627 a share. At closing, the scrip settled at ₹812.25 apiece. Intraday, the stock touched a high and a low of ₹944.95 and ₹796.35 respectively.
The company's Rs625 crore initial public offering (IPO) was subscribed more than 83 times. The IPO comprised an offer-for-sale of up to 90.15 lakh equity shares and a fresh issue of ₹60 crore shares. The price band for the issue was fixed at ₹626-627 per share.
The Gujarat-based entity plans to use the IPO proceeds for working capital requirements.
The portion set aside for non-institutional investors was subscribed 271.15 times, while that for qualified institutional buyers was subscribed 67.45 times. The retail portion was subscribed 11.84 times.
The company had raised Rs187.51 crore from 18 anchor investors.
Heranba Industries is a crop protection chemical manufacturer and is among the leading domestic producer of synthetic pyrethroids like cypermethrin, deltamethrin, lambda cyhalothrin, with a 20% market share. It derives 50% of its revenues from exports where it enjoys higher margin.
According to Motilal Oswal report, export demand is expected to be strong going ahead, given that many plants in China have shut down.
It has 371 registrations in international market along with 172 pending for approval. Further the company is in the process of developing two products each of fungicides, herbicides, and one insecticide, for sale to European markets.
It also has a well-diversified presence in India through more than 9,400 dealers/distributors.
Heranba’s revenues have grown at a compounded annual growth (CAGR) of 13% from FY18-20, net profit grew at a 44% CAGR. It has recorded robust average ROE and ROCE of 31.3% and 56% respectively for the last three years.
"Given huge opportunity in domestic and international space in agri and chemical space along with growing importance of domestic manufacturer globally, growth trajectory of Heranba is expected to sustain, in our view. Additionally, Heranba already has built sufficient resources in terms of land and other resources to set-up additional manufacturing unit, which bodes well", said Reliance Securities in a note to investors.
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Never miss a story! Stay connected and informed with Mint.
our App Now!!