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Anupam Rasayan IPO opens tomorrow: grey market premium falls; should you subscribe?

The volatility in Indian share market has hit the grey market premium of Anupam Rasayan. (Image: anupamrasayan.com)

The Rs 760-crore Anupam Rasayan preliminary public providing (IPO) is ready to open for subscription on Friday, 12 March 2021, at a value band of Rs 553-555 per share. Ahead of the IPO, the speciality chemical company raised Rs 225 crore from anchor traders. According to the BSE round, it has allotted 40.48 lakh shares to fifteen anchor traders at Rs 555 per share. Among the 18 anchor traders are Aditya Birla Sunlife Mutual Fund (MF), Nomura Funds Ireland Public Ltd Company, Fidelity International, Sundaram MF, SBI Life Insurance Co, IIFL Special Opportunities Fund, Malabar Select Fund and Max Life Insurance.

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The volatility in Indian share market has hit the grey market premium of Anupam Rasayan. The grey market premium of Anupam Rasayan has fallen 10 per cent to Rs 230 apiece thus far this week. The shares had been ruling at Rs 785 apiece, at a grey market premium of 41.44 per cent over the IPO value on Thursday. Earlier this week, the shares had been seen buying and selling at Rs 875 apiece, a grey market premium of 58 per cent.

Upon itemizing, Anupam Rasayan India might be becoming a member of the listed friends equivalent to PI Industries, Navin Fluorine International Ltd, Astec Lifesciences Ltd and SRF Ltd. The company has a powerful long-term relationship with many multinational firms like Syngenta Asia Pacific Pte Ltd, Sumitomo Chemical Company Ltd, and UPL Limited to increase geographical attain throughout international locations just like the United States, Europe, Japan, and India. Analysts at Anand Rathi Share and Stock Brokers Ltd have given ‘subscribe’ score to the difficulty because the company has a strong observe file of efficiency. “It is expected that the company will be able to gain more market share and simultaneously its margins will also improve. It has priced its issue at 95.2x PE at the upper band on a trailing basis which is aggressively priced as compared to its peers,” the analysis and brokerage agency added.

Anupam Rasayan India has six manufacturing services out of which 4 are located at Sachin and two are situated at Jhagadia with an aggregated put in capability of 23,438 MT as of December 31, 2020. “At the upper price band of Rs 555, the issue is priced at a 69x P/E and 5.8x P/BV,” Aditya Kondawar, Founder and COO, JST Investments, instructed Financial Express Online. Annualizing the 9MFY21 gross sales, the company is coming at 7.5x value to gross sales. Kondawar mentioned that the valuations are astronomical.

Investors can bid for at least 27 fairness shares and in multiples thereafter, translating to a minimal funding Rs 14, 985. The e-book working lead managers to the difficulty are Axis Capital Ltd, Ambit Private Ltd, IIFL Securities Ltd and JM Financial Ltd. While the registrar to Anupam Rasayan India Ltd might be KFin Technologies Private Ltd. Marwadi Shares and Finance Ltd has beneficial to ‘subscribe’ to the Anupam Rasayan India Ltd IPO based mostly on its previous observe file, sturdy long-term relationship with its clients and likewise the strategic manufacturing location together with enormous capex within the final three fiscals. An analyst at a analysis agency mentioned that contemplating TTM EPS of Rs 5.83 on a post-issue foundation, the company goes to record at a P/E of 95.16X with a market cap of Rs 55,445 mn. The subject is aggressively priced in comparison with its friends; Navin Fluorine is buying and selling at a P/E of 29.6X and PI Industries at 51.4X.

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