Tatva Chintan Pharma Chem Ltd made its debut in the market with its Rs 500-crore initial public offering (IPO) on July 16. The IPO closed its subscriptions on July 20 with a tremendous subscription from investors that clocked in at around 180.36 times around 17:00 pm. The company which was incorporated in 1996 is a chemical manufacturing entity that specializes in the manufacture of Structure Direct Agents (SDAs), Phase Transfer Catalysts (PTCs), pharmaceutical and agrochemical intermediates, as well as other speciality chemicals. The client list of the company includes Merck, Bayer AG, Ipox Chemicals, Laurus labs, Navin Fluorine International Limited, Atul Limited, Otsuka Chemicals, SRF Limited, Hawks Chemical Company, Firmenich Aromatics Prod Pvt Ltd, and Divi’s laboratories to name a few, according to information on Chittorgarh.
With that said, here is everything that you need to know about Tatva Chintan’s IPO.
The IPO Overview
The IPO worth Rs 500 crore opened on July 16 and closed on July 20. It is a Book Built Issue IPO with a face value of Rs 10 per equity share. The price band of the IPO stood at Rs 1073 to Rs 1083 per equity share. It also comprised of a fresh issue of around Rs 225 crore and an offer for sale (OFS) worth Rs 275 crore.
IPO Grey Market Premium
The company’s IPO had a Grey Market Premium (GMP) of Rs 1000 per share on Saturday. This indicates that the shares were trading on the grey market at around Rs 2073 to Rs 2083 per share against the Rs 1073 to Rs 1083 price band that was allocated for the IPO. When the company opened its IPO to the market, it started on the grey market at just Rs 600. This saw an upward trend as the price hit Rs 730 towards the last day of bidding.
The Pre-IPO Dates
The open date for the IPO was on July 16 and the close date was on July 20. Given that, any anchor bookings that happened would have taken place a day prior to the open date, on July 15.
Post IPO Dates to Know
The Basis of Allotment, stands tentatively as July 26, 2021, as per the information given on Chittorgarh and IPO Watch. For the unsuccessful bidders, the refunds are set to happen the day after allotment takes place, on July 27. The successful bidders on the other hand will see their investments credited to Demat accounts on July 28, as per reports. For the investors on the lookout for the listing date, it is tentatively fixed as July 29, though this is yet to be confirmed.
IPO Lot Size and Reservations
Tatva Chintan’s IPO lot size had a minimum of 13 shares with a cut-off amount of Rs 14,079 for the application. On the opposite end, the upper limit had a lot size of 182 shares with a cut-off of Rs 197.106. Retail investors were allowed to apply for up to 14 shares at the upper-most lot size. In terms of reservations, the Qualified Institutional Buyers (QIB) had an allocation of 50 per cent, the Non-Institutional Investors (NII) had a reservation of 15 per cent and the Retail segment had a 35 per cent reservation. The public issue subscribed 35.35 times in the retail category, 185.23 times in the QIB category, and 512.22 times in the NII category.
Brief Overview of Company Financials
Due to the high sales rate of its SDAs and PASCs the company saw revenue growth of 21 per cent CAGR over FY19-21. The EBITDA was recorded at 44 per cent CAGR over FY19-21, while the PAT was recorded at 60 per cent in the same timeframe. The EBITDA margin went up from 16.6 per cent in FY-19 to 23.8 per cent in FY21 as per reports. It has an RoE of 32 per cent for FY21 and the balance sheet has a healthy standing with a lowered D/E ratio of 0.54 times as of FY 21.
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