Tatva Chintan Pharma’s Rs 500-crore IPO has been subscribed 17.22 occasions by investors, with the last day of bidding nonetheless on. The specialty chemical manufacturer has attracted sturdy interest from all pockets of investors just after obtaining the concern was oversubscribed inside the initial two hours of sale last Friday. Shares of the corporation have also impressed in the grey market place, trading at a sturdy premium more than the concern value. Investors can bid for the concern till today evening in the value band of Rs 1,073 – Rs 1,083 per share in a bid lot of 13 shares.
So far, certified institutional purchasers (QIB) have bid for 27.59 lakh shares against 9.31 on give, subscribing to their portion of the IPO 2.96 occasions. Non-institutional investors have subscribed their portion of concern 16.01 occasions, bidding for 1.03 crore shares so far. Retail investors have bid for the maximum quantity of shares so far, subscribing to their portion 25.89 occasions. Overall investors have bid for 5.61 crore shares against the 32.62 lakh on give, translating to a 17.22 occasions subscription price.
The concern is a mix of an give for sale by current investors and a fresh concern of equity shares by the corporation. While Rs 275 crore from the concern will go to promoting shareholders, Rs 225 crore will be made use of by Tatva Chintan Pharma to fund the expansion plans of their Dahej facility and to upgrade the R&D facility at Vadodara. Promoter shareholding in the corporation will come down from one hundred% to 79.17% just after the IPO, whilst public shareholding will enhance to 20.83% from %.
In the grey market place, Tatva Chintan Pharma’s shares have been trading at a premium of almost Rs 760 per share more than the IPO value of Rs 1,083 apiece, according to folks dealing in the unlisted space. The premium has steadily improved more than the last week. Tatva Chintan Pharma net profit has grown at a compound annual development price of 62% involving the monetary year 2018 and 2021. In the prior fiscal year the corporation reported a net profit of Rs 52.3 crore. Revenue has grown at a price of 30.3%.
“We like Tatva Chintan Pharma due its leadership position, wide product portfolio, strong client relationship and high entry barriers. The company is expected to witness strong growth for the next 2-3 years given its expansion plans,” mentioned analysts at Motilal Oswal in a pre-IPO note. “The issue is valued at 45.9x FY21 P/E on a post-issue basis, which appears reasonable compared to peers (avg. P/E of 59x), as it enjoys higher earnings growth,” they added. The brokerage firm has a ‘subscribe’ rating to the concern. Similarly, pinning a ‘subscribe’ rating on the concern, analysts at Choice Broking think the IPO is priced at a discount to peer typical of 57.2x.
Tatva Chintan Pharma will join peers such as PI Industries, Aarti Industries, Atul, Deepak Nitrite, Vinati Organics, SRF, amongst other folks on the stock exchanges on productive listing.