Rossari Biotech Ltd IPO Watch in Detail

Rossari Biotech Ltd IPO

Rossari Biotech ltd was founded in 2009, Rossari Biotech Ltd deals in textiles specialty chemicals. Company provides customized solutions to the Home Personal care, Textile Speciality Chemicals, Animal health & Nutrition and FMCG industries by offering a diversified product portfolio.

Rossari Biotech company operates in 18 countries including India, Bangladesh, Vietnam, and Mauritius and it is the largest textile specialty chemical manufacturer. The business of the company can be classified into three main categories.

BUSINESS SEGMENTS:

Home Personal care and performance chemicalsSOAPS AND DETERGENTSINKS, PAINTS AND COATINGS, CERAMICS AND TILE, SPULP AND PAPER, CEMENT, WATER TREATMENT
Textile specialty chemicalsCOTTON, POLYESTER, ACRYLIC, WOOL, SILK, NYLON, FUNCTIONAL FINISHES, DENIM, PRINTING, SUSTAINABLE SOLUTIONS
Animal health and nutrition productsPET CARE, POULTRY NUTRITION

Rossari Biotech IPO Details Snapshot:

IPO Subscription DatesJul 13, 2020 – Jul 15, 2020
Price BandINR423 – 425 per share
Issue Size₹496.49 Cr.
Fresh issue₹50 crore
Offer For Sale (OFS)10,500,000 shares (₹444.15 – 446.25 crore)
Minimum bid (lot size)35 Shares
Face Value ₹2 per share
Retail Allocation35%
Listing AtNSE, BSE
Market Cap in (₹ Cr.)2207
Price to Earn ratio ( P/E )33.81

IPO Tentative Date and Timetable:

Bid/Offer Open dateJul 13, 2020
Bid/Offer Close dateJul 15, 2020
Finalisation of Basis of AllotmentJul 20, 2020
Initiation of RefundsJul 21, 2020
Credit of Shares to Demat AccountJul 22, 2020
IPO Share Listing DateJul 23, 2020

IPO Lot Size and Price Detail :

Application LotsSharesAmount (Cut-off)
Minimum 135₹14,875
Maximum 13455₹193,375

Company Promoters :

Mr. Edward Menezes and Mr. Sunil Chari 

Key strengths of Rossari Biotech Limited:

Every body should know the company’s key strengths so that invester can compare it with its competitors to know how unique and better in their business company is. Their investment decision should be based on these facts. Below points are the key strengths of the Rossari Biotech.

  1. Diversified product portfolio.
  2. Largest textile specialty chemical manufacturer in India.
  3. Extensive manufacturing and technical capabilities
  4. Strong R&D capabilities, with focus on innovation and sustainability
  5. Wide sales and distribution network.
  6. Experienced Promoters with a strong management team.
  7. Better financial performance

Manufacturing Plants :

Rossari Biotech Ltd IPO

Rossari Biotech in-house most of the products of the company are manufactured. Company has a manufacturing unit located at Silvassa, Dadra & Nagar Haveli with an installed capacity of 100,000 MTPA and also setting up a manufacturing unit at Dahej in Gujarat with an installed capacity of 132,500 MTPA. Rossari Biotech also has two R&D facilities in Silvassa and Mumbai locations to focus on new product development, formulations, and cost competitiveness. It has more than 194 distributors across India and 27 distributors spread in other 17 countries.

Rossari Biotech Research and Development:

As Rossari Biotech is technology-driven company and constantly strive to incorporate new practices into their business to deliver quality products to the customers. Company have a dedicated research lab that is DSIR-certified (Department of Scientific and Industrial Research, Government of India).

How is the IPO Priced?

On the upper price band of ₹425  and the last 3 years average EPS of ₹10.73, the P/E works out to be 39x. Similarly, on the upper price band of ₹425 and the last year FY-20 average EPS of ₹13.42, the P/E works out to be 31x. Its peers like Fine organic industries limited is trading at P/E of 35x (Highest) and Atul India is trading at P/E of 20x (Lowest) and industry average P/E is 27.7x. Hence, Rossari Biotech IPO share price (upper band) of ₹425 in the P/E range of 31x to 39x is highly priced.

Should you do investment in Rossari Biotech IPO for long term?

Rossari Biotech is one of the leading specialty chemical manufacturing companies in India. Its revenues and margins are consistent and growing. Rossari Biotech IPO price is highly priced. Considering bright prospects company has, high risk investors can invest in such IPOs. Moderate to low risk takers should avoid such IPOs.

Company Address : 201 A & B Ackruti Corporate Park LBS Marg Next to G. E. Gardens, Kanjurmarg West, Mumbai, Maharashtra 400078

Disclaimer: This article is for educational purpose only. Please consult your investment advisor before you investment in such high risk IPOs.

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