Chemplast Sanmar Limited | Globe Capital
Chemplast Sanmar Limited
Closed
Price Band
Rs. 530 – 541
IPO Issue Period
Aug 10, 2021 to Aug 12, 2021
Issue Size
Rs. 3850 Cr.
Face value
Rs. 5/-
Fresh issue
Rs. 1300 Cr.
Offer for sale
Rs. 2550 Cr.
Minimum Shares for Retail
27 shares
Maximum Shares for Retail
351 shares
Listing on
NSE, BSE
Issue Type
Book Building
Tentative Listing Date
12-Aug-21
QIB
Not More than 75% of the offer
NII
Not less than 15% of the offer
Retail
Not less than 10% of the offer
Registrar to the Issue
KFintech Private Limited

Ambit Private Limited, Axis Capital Limited, BOB Capital Markets Limited, Credit Suisse Securities (India) Private Limited, HDFC Bank Limited, ICICI Securities Limited, IIFL Holdings Limited, IndusInd Bank Limited, Yes Securities (India) Limited

Chemplast Sanmar Ltd (CSL) is a leading specialty chemical manufacturer in India. The company is engaged in the manufacturing of specialty paste PVC resin, starting materials, and intermediates for agro-chemical, pharmaceuticals, agro-chemical, and fine chemical sectors. It also produces other types of chemicals such as Caustic Soda, Chlorochemicals, Hydrogen Peroxide, Refrigerant gas, and Industrial Salt.It has four manufacturing facilities, among which, 3 are situated at Mettur, Berigai, and Cuddalore in Tamil Nadu, and one is located in Puducherry at Karaikal. Sanmar Holdings Limited is the promoter of the company. The Company is a part of the SHL Chemicals Group, which in turn is a constituent of the Sanmar Group, one among the oldest and most prominent corporate groups in South India region. Fairfax India Holdings Corporation (“Fairfax”), a well-known international investor led by Prem Watsa, based in Canada, has invested, through FIH Mauritius Investments Ltd, in the SHL Chemicals Group since 2016.

For year/ period ended ( in Cr.)

31 Mar 2021 31 Mar 2020 31 Mar 2019
Total Revenue 3798.73 1257.66 1254.34
Profit After Tax 410.24 46.13 118.46
EPS 30.60 2.04 4.53
OPM(%) 29.55 20.11 23.53
PATM(%) 10.80 3.67 9.44
  • It is the largest manufacturer of specialty paste PVC resins in India in terms of installed production capacity
  • The Company is the 3rd largest manufacturer of caustic soda and the largest manufacturer of hydrogen peroxide in South India
  • A part of the SHL Chemicals Group, one of the most prominent corporate groups in South India
  • A vertically integrated business model with a focus on quality manufacturing
  • It has a strong management team with extensive experience in the chemicals industry and a track record of operational excellence

The Company proposes to utilise the net proceeds towards funding the following objects:

  • Early redemption of NCDs issued by the company in full
  • Meet general corporate purposes

At the upper of Rs 541, the stock is valued at 18 times P/E multiple. Which is lower than it’s nearest listed peers. After a decade the company is trying to relist its shares with 7.5 times higher valuations. Though the issue appears reasonably priced, it is due to the non-convincing super performance of FY21 and sustainability is a major concern. Hence, investors may consider this IPO for long term perspectives.

Timeline
Application Start
10-08-2021
Application End
12-08-2021
Allotment Begins
18-08-2021
Refund Initiation
20-08-2021
Allotment Date
23-08-2021
Listing on exchange
24-08-2021
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