Heranba Industries shares created a stellar listing on the stock exchanges today, unscathed by the mildly weak market place sentiment. Shares of the firm started trading at Rs 900 per share, up 43.54% from the IPO value of Rs 627 apiece. On listing, Heranba Industries was commanding a market place capitalisation of Rs 3,600 crore. Global markets have been jittery on Friday as bond yields in the United States rose once more. The IPO of the firm was oversubscribed 82 occasions with retail investors bidding for 11.84 occasions their portion, Non-Institutional Investors (NII) bid for a whopping 271 occasions and Qualified Institutional Buyers (QIB) subscribed their portion 67 occasions.
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The agrochemical firm has managed to raise Rs 625 crore by means of the IPO. Of this, Rs 60 crore is a fresh problem although the remaining is an Offer for Sale (OFS) by current shareholders. Post problem, the promoter and promoter group shareholding in the firm has dropped to 74.15%, from 98.85% earlier. Public shareholding has enhanced to 25.85% from 1.15% prior to the problem.
Heranba Industries manufactures intermediates, technicals and formulations and is one of the major domestic producers of synthetic Pyrethroids. Domestic pyrethroid suppliers, such as Heranba Industries, are anticipated to advantage from China’s crackdown on pollution which has led to the closing of lots of chemical plants. The Pyrethroids market place in India is projected to develop at a CAGR of 8.5% in 2020-25, reaching a production volume of 25,398 tonnes by 2025, stated ICICI Direct in a note.
The firm has a presence in a wide variety of merchandise across the whole worth chain of synthetic pyrethroids with worldwide outreach and a wide distribution network. “Heranba has an extensive distribution network in India supported by a skilled sales force. It has more than 9,400 dealers having access to 21 depots across 16 states and one union territory in India supporting the distribution of its products,” domestic brokerage firm Choice Broking stated.
Heranba Industries counts organizations like Sumitomo Chemical India, Sulphur Mills, Biostadt India, Crystal Crop Protection, NACL, PI Industries, Krishi Rasayan Group, Agro Life Science Corporation and Shanghai Agricare Chemical Company. Only 19% of its total income comes from the top rated 10 consumers.
On the upper finish of the value band, ICICI Direct valued the firm at a P/E of 25.7x FY20. Choice Broking stated that the firm is demanding a TTM P/E numerous of 25.7x (to its restated TTM EPS of Rs 24.4), as compared to the peer typical of 27.4x. Religare Broking valued it at a PE of 25x EPS FY20.