Mumbai-based Prasol Chemicals Limited, amongst the leading forward integrated manufacturers of acetone derivatives and phosphorous derivatives in India, has received the SEBI nod for its initial public offering (IPO).
The initial share sale with a face value of Rs 2 per equity share comprises a fresh issue of equity shares aggregating up to Rs 250 crore and an offer-for-sale (OFS) of up to 9,000,000 equity shares by existing shareholders. The Offer is being made through the Book Building Process, wherein not more than 50% of the Offer shall be available for allocation to Qualified Institutional Buyers, not less than 15% of the Offer shall be available for allocation to Non-Institutional Bidders and not less than 35% of the Offer shall be available for allocation to Retail Individual Bidders.
The company, in consultation with the lead bankers to the issue, may consider a further issue of equity shares aggregating up to Rs 50 crore. If such placement is completed, the fresh issue size will be reduced.
The proceeds from the fresh issue will be utilized to the tune of Rs 160 crore for repayment or prepayment, in full or part of certain borrowings of the company, Rs 30 cr for working capital requirements, and for general corporate purposes.
Since its inception, Prasol Chemicals has expanded its business and scope of operations, evolving from a small-scale manufacturer to a big diversified specialty chemical company with a global presence. The Government of India accredited Two Star Export House Company receives 100% of its revenues from exports and has a global distribution network spanning 45 countries across Asia, North America, and the European Union.
It has recently tied - up with Technolab and IIT Chemical Engineering to develop new products from waste streams.
Several acetones and phosphorus derivatives are included in its portfolio and are used in the synthesis of agrochemical active ingredients (technicals) and formulations, besides its application as a critical raw material in sunscreens, shampoos, flavors, fragrances, and disinfectants. It competes with SI Group, Solvay, Evonik, Arkema, and ALTIVIA, locally it faces little competition due to the limited presence of acetone derivative manufacturers.
As of December 31, 2021, the had a portfolio of more than 140 products and a pipeline of 32 products under development. In the last three fiscals and nine months period, it has launched 38 products.
Prasol has established relationships with clients such as PI Industries Limited, Bayer CropScience Limited, Solvay Specialities India Private Limited, Proctor & Gamble, Dr. Reddy's Laboratories Limited, Alembic Pharmaceuticals Limited, Coromandel International Limited, Arkema, Lubrizol India Private Limited, UPL Limited, Olon Active Pharmaceutical Ingredients India Private Limited, MSN Laboratories Private Limited, Oriental Aromatics Limited, Asian Paints Limited, Indoco Remedies Limited, Lanxess India Private Limited, Croda India Company Private Limited, Bharat Rasayan Limited, Hubergroup India Private Limited, Indian Additives Limited, Privi Speciality Chemicals Limited, Supriya Lifescience Limited, NGL Fine - Chem Limited and Everest Organics Limited through decades of association, collaborative efforts through research and development of new and customized additives, and by undertaking synergetic business opportunities and from industry experience.
The company clocked a profit of Rs 25.08 crore in the financial year FY21 against Rs 37.77 crore, impacted by Covid-19, whereas revenue from operations increased 12.10% to Rs 595.54 crore in fiscal 2021 from Rs 531.24 crore in fiscal 2020, primarily due to increase in the selling price of the specialty products manufactured. Profit for the nine-month period ended December 2021 stood at Rs 50.10 crore on a revenue of Rs 626.93 crore. As on Dec 2021, the Top 10 of its products contribute less than 25% of its revenues and the Top 5 less than 15%.
JM Financial Limited and DAM Capital Advisors Limited are the book-running lead managers and Kfin Technologies is the registrar of the offer.