The initial public offer (IPO) of Rossari Biotech Ltd, the first IPO to hit the Indian markets since March, was completely subscribed on the second day of the offering, indicating strong demand for shares of the specialty chemical company.
According to stock exchange data, the IPO was subscribed 2.36 times as of 4 pm.
Rossari Biotech has set a price band of ₹423-425 per share. The IPO closes on 15 July. The company plans to raise Rs50 crore through the IPO, while promoters are selling shares worth Rs446 crore.
The portion of shares reserved for institutional investors was subscribed 1.32 times, while shares reserved for non-institutional investors or HNIs was subscribed 4.12 times. Retail quota was subscribed 2.2 times.
Rossari Biotech is a manufacturer of specialty chemicals, which provides customized solutions to the apparel, animal & poultry feed, and FMCG industries. It offers a diversified product portfolio and operates in 18 countries, including India, Bangladesh, Vietnam, and Mauritius.
Analysts at Angel Broking Ltd said “At the upper end of the price band, Rossari demands PE multiple of 32.1 times FY2020 fully diluted EPS. None of the listed chemical companies has the same business as Rossari. It will command a premium over most of its chemical peers as it is net debt free as well as it has better asset turnover, working capital days, ROE and ROCE better than most of its peers, we would recommend to “Subscribe” to the issue.”
Rossari Biotech is the first IPO to hit the Indian markets since SBI Cards and Payments Services Ltd raised over Rs10,000 crore in early March.
Investment banks Axis Capital and ICICI Securities are managing the IPO.