Nifty 17196.7 (-1.18%)
Sensex 57696.46 (-1.31%)
Nifty Bank 36197.15 (-0.85%)
Nifty IT 35848.05 (-0.86%)
Nifty Financial Services 17779.5 (-1.13%)
Adani Ports 737.45 (-0.22%)
Asian Paints 3110.45 (-2.21%)
Axis Bank 673.00 (-0.46%)
B P C L 385.90 (1.86%)
Bajaj Auto 3287.85 (-1.22%)
Bajaj Finance 7069.25 (-1.55%)
Bajaj Finserv 17488.70 (-1.52%)
Bharti Airtel 718.35 (-1.94%)
Britannia Inds. 3553.75 (-0.69%)
Cipla 912.05 (-1.00%)
Coal India 159.75 (0.28%)
Divis Lab. 4757.05 (-0.42%)
Dr Reddys Labs 4596.50 (-1.42%)
Eicher Motors 2455.55 (0.16%)
Grasim Inds 1703.90 (-1.16%)
H D F C 2771.65 (-1.29%)
HCL Technologies 1171.40 (-1.12%)
HDFC Bank 1513.55 (-0.80%)
HDFC Life Insur. 690.95 (-2.03%)
Hero Motocorp 2462.45 (-0.41%)
Hind. Unilever 2343.65 (-1.66%)
Hindalco Inds. 424.65 (-1.72%)
I O C L 122.20 (1.28%)
ICICI Bank 716.30 (-0.84%)
IndusInd Bank 951.15 (0.59%)
Infosys 1735.55 (-0.73%)
ITC 221.65 (-1.69%)
JSW Steel 644.55 (-0.34%)
Kotak Mah. Bank 1914.20 (-2.55%)
Larsen & Toubro 1801.25 (0.67%)
M & M 836.95 (-1.48%)
Maruti Suzuki 7208.70 (-1.59%)
Nestle India 19321.35 (-0.93%)
NTPC 127.00 (-1.32%)
O N G C 145.90 (1.32%)
Power Grid Corpn 206.10 (-3.92%)
Reliance Industr 2408.25 (-3.00%)
SBI Life Insuran 1165.95 (-1.86%)
Shree Cement 25914.05 (-1.43%)
St Bk of India 473.15 (-0.81%)
Sun Pharma.Inds. 751.80 (-1.89%)
Tata Consumer 774.30 (0.14%)
Tata Motors 480.10 (0.21%)
Tata Steel 1118.00 (0.50%)
TCS 3640.45 (-0.07%)
Tech Mahindra 1593.30 (-2.23%)
Titan Company 2369.25 (-0.72%)
UltraTech Cem. 7332.45 (0.13%)
UPL 712.75 (2.08%)
Wipro 640.75 (-0.94%)

DGCA lifts ban on Boeing 737 Max Aircraft

DGCA
26/08/2021

In a significant move for Indian aviation, the Directorate General of Civil Aviation (DGCA) has lifted the ban on Boeing 737 Max aircraft. These aircraft can start flying again right away. The DGCA had imposed a ban on flying these aircraft in March 2019 after two fatal accidents were reported due to faulty design of the aircraft.

Lifting of the ban was long overdue since 175 countries had allowed the Boeing 737 Max to fly again. The DGCA has expressed satisfaction that requisite conditions were met by the 737 aircraft and was fit to fly again. With India also approving the Boeing Max 737 in Indian skies, China remains the only major aviation market to still ban the Max 737.

Also Read: Rakesh Jhunjhunwala Bets Big on Indian Aviation with Akasa Air

The ban on Boeing 737 Max aircraft had been imposed by DGCA after the fatal crash of the 737 Max flown by Ethiopian Airlines in Mar-19. All 157 persons on board, including 4 Indians, were killed in the crash. Earlier, in Oct-18, a similar aircraft flown by Lion Air had crashed in Indonesia leaving 189 dead. In both cases, the automatic safety system had been triggered leading the plane to nosedive.

In India, the largest and only major customer for the Boeing 737 Max Aircraft is SpiceJet. It has a pipeline of more than 100 aircraft on order and flies the 737 extensively across India. The impact was immediately visible in the stock price of SpiceJet, which rallied 4% after the lifting of the ban was announced by the DGCA.

It resolves another major problem for SpiceJet with respect to its Irish Lessor, Avolon, that leased these Max Aircraft to SpiceJet. Most aircraft lease contracts are covered by the “Hell or High Water” clause, under which lease rentals are payable even in the face of Force Majeure conditions. Now SpiceJet has entered into an agreement with Avolon to resume operations and puts SpiceJet on safer ground.

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List of Upcoming IPOs in September 2021

List of Upcoming IPOs in September 202
by Nikita Bhoota 26/08/2021

The Indian economy is gradually picking up as lockdown restrictions are easing across various states. Further, improving the vaccination process, healthy economic data and positive global announcements are also supporting the economy. 

The results of these are clearly seen in the performance of the stock market. Equity benchmarks Nifty 50 and Sensex touched a new closing high of 17,234.15 and 57,852.54 respectively on September 2, 2021. Similarly, the ipo market is also gaining traction. A lot of companies have and are coming up with IPOs this year 2021.

Here is a list of upcoming IPOs in the month of September-21. This list is subject to modifications once any further updates are received from the companies or regulatory body (SEBI).

Upcoming IPOs List in September 2021:

Company Name Issue Size (₹ cr) Open Date Close Date
AMI Organics Limited 570 Sept 1,2021 Sept 3,2021
Arohan Financial Services Limited 1,800 Yet to be announced Yet to be announced
Vijaya Diagnostic Centre Limited 1,895 Sept 1,2021 Sept 3,2021
Fincare Small Finance Bank 1,330 Yet to be announced Yet to be announced
ESAF Small Finance Bank Ltd 998 Yet to be announced Yet to be announced
MobiKwik 1,900 Yet to be announced Yet to be announced
Aditya Birla Sun Life Asset Management Company 2,000 Yet to be announced Yet to be announced
Adani Wilmar 4,500 Yet to be announced Yet to be announced
Paras Defence and Space Technologies Limited 120 Yet to be announced Yet to be announced
GoFirst 3,600 Yet to be announced Yet to be announced
Seven Islands Shipping 600 Yet to be announced Yet to be announced
Aadhar Housing Finance 7,300 Yet to be announced Yet to be announced
Follow- on Public Offer (FPO)
Ruchi Soya Industries 4,300 Yet to be announced

 

Sansera Engineering Ltd.

Company Background:

Sansera Engineering Limited is an engineering-led integrated manufacturer of complex and critical precision engineered components across automotive and non-automotive sectors. Within the automotive sector, the company manufactures and supplies a range of precision forged and machined components and assemblies, such as connecting rod, rocker arm, crankshaft, gear shifter fork, stem comp, and aluminium forged parts, that are critical for engine, transmission, suspension, braking, chassis and other systems for the two-wheeler, passenger vehicle and commercial vehicle verticals. Within the non-automotive sector, Sansera Engineering manufactures and supplies a range of precision components for the aerospace, off-road, agriculture and other segments, including engineering and capital goods. The company supplies most of their products directly to OEMs in finished (forged and machined) condition, resulting in significant value addition by them.

Sansera Engineering Ltd IPO Details:

•    The issue opens on 14 September 2021 and closes on 16 September 2021.
•    The issue size of the IPO is around Rs1,283crores.
•    The objective of the offer is to carry out the offer for sale of up to 17,244,328 equity shares by the selling shareholders and achieve the benefits of listing the equity shares on the stock exchanges.
•    BRLM to the issue are IIFL Securities Ltd, ICICI Securities, Nomura Financial Advisory & Securities.
•    Link Intime India Pvt. Ltd. is the registrar to the issue.  

AMI Organics Limited

Company Background:

AMI Organics Limited is a research and development (R&D) driven manufacturer of specialty chemicals with varied end usage, focused on the development and manufacturing of advanced pharmaceutical intermediates (Pharma Intermediates) for regulated and generic active pharmaceutical ingredients (APIs) and New Chemical Entities (NCE) and key starting material for agrochemical and fine chemicals, especially from the recent acquisition of the business of Gujarat Organics Limited (GOL). The Pharma Intermediates which it manufactures, find application in certain high-growth therapeutic areas including anti-retroviral, anti-inflammatory, anti-psychotic, anti-cancer, anti-Parkinson, anti-depressant and anti-coagulant, commanding significant market share both in India and globally.

AMI Organics IPO Details:


•    The IPO consists of fresh issue of ₹200cr after the company chose pre-IPO placement of ₹100 cr. Whereas, the offer for sale is 6,059,600 shares amounting to ₹369.6cr, the proceeds of which would go directly to the selling shareholders.
•    Out of the proceeds from the IPO and pre-IPO placement, ₹140 cr would be utilized towards repayment/prepayment of certain loans availed by the company while ₹90cr would be used for funding the working capital requirements of the company and the balance of the fresh issue would be used for general corporate purposes. 
•    The book running lead managers to the issue are Intensive Fiscal Services, Ambit Private Limited and Axis Capital Limited.
•    Link Intime India Private Limited is the registrar to the issue.

 

Arohan Financial Services Limited

Company Background:

Arohan Financial a leading NBFC-MFI with operations in financially under-penetrated Low Income States of India. We provide income generating loans and other financial inclusion related products to customers who have limited or no access to financial services. As of September 30, 2020, our Gross Loan Portfolio (“GLP”) was ₹48.57 billion. We were the largest NBFC-MFI in Eastern India and the fifth largest NBFC-MFI in India based on Gross Loan Portfolio as of September 30, 2020.

Arohan Financial Services Limited IPO Details:

•    Arohan Financial has filed DRHP with SEBI for ₹1,800 crore IPO. 
•    The IPO consists of Fresh Issue of ₹850 crores and OFS of 2,70,55,893 equity shares.
•    Net Proceeds from the Offer shall be utilized for augmenting the capital base of the Company
•    The book running lead managers (BRLMs) to the issue are Edelweiss Financial Services Limited, ICICI Securities Limited, Nomura Financial Advisory and Securities (India) Private Limited and SBI Capital Markets Limited.
•    Link Intime India Private Limited is the registrar to the issue.

 

Vijaya Diagnostic Centre Limited:

Company Background:

Vijaya Diagnostic Centre Limited offers a one-stop solution for pathology and radiology testing services to its customers through the extensive operational network, which consists of 81 diagnostic centres and 11 reference laboratories across 13 cities and towns in the states of Telangana & Andhra Pradesh, the National Capital Region and Kolkata as on June 30, 2021.

Vijaya Diagnostics IPO Details:

•    The offer comprises of an offer for sale of ₹1,895cr. 
•    The objects of the Offer are to carry out the Offer for Sale of up to 35,688,064 Equity Shares by Selling Shareholders and achieve the benefits of listing the Equity Shares on the Stock Exchanges.
•    The BRLMs to the issue are ICICI Securities, Edelweiss Financial Services and Kotak Mahindra Capital Company.
•    KFin Technologies Pvt. Ltd.is the registrar to the issue.

 

Fincare Small Finance Bank:

Company Background:

Fincare Small Finance Bank has a suite of banking products such as savings accounts, current accounts, fixed deposits, NRI fixed deposits, recurring deposits, microloans, cash overdraft, loans against gold, loan against property, institutional finance, and two-wheeler loan.

Fincare Small Finance IPO Details

•    Fincare Small Finance Bank has filed draft papers for its initial public offering (IPO) with the Securities and Exchange Board of India (SEBI). It plans to raise ₹1,330 crore from the primary market.
•    The IPO of Bengaluru-based microfinance company comprises a fresh issue of ₹330 crore by the bank and an offer for sale of ₹1,000 crore by promoter Fincare Business Services.
•    BRLMs to the issue are ICICI Securities, Axis Capital, IIFL Securities, and SBI Capital Markets.
•    KFin Technologies Pvt. Ltd.is the registrar to the issue.

 

ESAF Small Finance Bank Ltd

Company Background:

ESAF Small Finance Bank is one of the leading small finance banks in India in terms of client base size, yield on advances, net interest margin, assets under management CAGR, total deposit CAGR, loan portfolio concentration in rural and semi-urban areas and ratio of micro loan advances to gross advances.

ESAF Small Finance Bank IPO Details:

•    The company is planning to raise ₹998 crore through its public issue. 
•    The IPO consists of a fresh issue of ₹800 crore and an OFS of ₹197.78 crore by existing selling shareholders.
•    The bank intends to utilise the net proceeds from IPO towards expansion of its tier-1 capital base.
•    Axis Capital, Edelweiss Financial Services, ICICI Securities and IIFL Securities are BRLMs to the issue.
•    Link Intime India Private Limited is the registrar to the issue.

 

One Mobikwik Systems Limited

Company Background:

One Mobikwik Systems Limited is a fintech company. It is one of the largest mobile wallets (MobiKwik Wallet) and Buy Now Pay Later (“BNPL”) players in India, based on mobile wallet gross merchandise value (“GMV”) and BNPL GMV, respectively, in Fiscal 2021 (Source: RedSeer Report).

One Mobikwik IPO Details:

•    The company is planning to raise ₹1,900 crore through its public issue. 
•    The IPO consists of a fresh issue of ₹1,500 crore and an OFS of ₹400 crore by promoters and certain shareholders. 
•    The company intends to utilise the net proceeds from IPO for funding organic growth initiatives; funding inorganic growth; and general corporate purposes.
•    ICICI Securities Limited, BNP Paribas, Credit Suisse Securities (India) Private Limited, IIFL Securities Limited and Jefferies India Private Limited are BRLMs to the issue.
•    Link Intime India Private Limited is the registrar to the issue.

 

Aditya Birla Sun Life Asset Management Company

Company Background:

Aditya Birla Sun Life Mutual Fund is one of the largest fund houses in India. Aditya Birla Sun Life Mutual Fund is a joint venture between the Aditya Birla Group and Sun Life Financial, Canada based international financial company. Aditya Birla MF offers in-house mutual funds across different asset classes.

Aditya Birla Sun Life Asset Management IPO Details:


•    Aditya Birla Capital will sell up to 2.88 million shares held by it in the asset management business, while Sun Life (India) AMC will sell up to 36.03 million shares. Aditya Birla Capital holds 51% stake in the AMC, and the remaining 49% is held by Sun Life. 
•    Kotak Investment Banking, Bofa Securities, Citigroup Global markets India, Axis Capital, HDFC Bank Limited, ICICI Securities, IIFL Securities, JM Financial, Motilal Oswal Investment Banking, SBI Capital and Yes Securities are the global co-ordinators and BRLMs to the issue.
•    Aditya Birla Capital Ltd and Sun Life (India) AMC will together sell a 13.5% stake in their asset management joint venture - Aditya Birla Sun Life AMC Ltd.
•    The IPO size could be around ₹2,000 crore
•    KFin Technologies Private Limited is the registrar to the issue.

 

Adani Wilmar Limited:

Company Background:

Adani Wilmar Limited is one of the few large FMCG food companies in India to offer most of the essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses and sugar. (Source: Technopak Report). The company offers a range of staples such as wheat flour, rice, pulses and sugar. “Fortune” is the flagship brand, of the company. It is the largest selling edible oil brand in India (Source: Technopak Report).
 

Adani Wilmar IPO Details:                           

•    The company is planning to raise ₹4,500 crore through its public issue. 
•    The company intends to utilise the net proceeds from IPO for funding capital expenditure for expansion of our existing manufacturing facilities and developing new manufacturing facilities, repayment/prepayment of our borrowings, funding strategic acquisitions and investments and general corporate purposes
•    Kotak Mahindra Capital Company Limited, J.P. Morgan India Private Limited, BofA Securities India Limited, Credit Suisse Securities (India) Private Limited, ICICI Securities Limited, HDFC Bank Limited, and BNP Paribas are global co-ordinators and BRLMs to the issue.
•    Link Intime India Private Limited is the registrar to the issue.

 

Paras Defence and Space Technologies Limited 

Company Background:

Paras Defence and Space Technologies Limited is an Indian private sector company engaged in designing, developing, manufacturing and testing of a wide range of defence and space engineering products and solutions. It is also one of the leading ‘Indigenously Designed Developed and Manufactured’ (“IDDM”) category private sector company in India which caters to four major segments of Indian defence sector i.e. defence and space optics, defence electronics, electro-magnetic pulse (“EMP”) protection solution and heavy engineering. (Source F&S Report) The company is also the sole Indian supplier of critical imaging components such as large size optics and diffractive gratings for space applications in India (Source F&S Report).

Paras Defence and Space Technologies IPO Details:
•    The company is planning to raise ₹120 crore through its public issue. 
•    The offering comprises fresh issuance of shares worth ₹120 crore and an offer of sale of up to 17,24,490 equity stocks by promoters and existing shareholders
•    The company intends to utilise proceeds of the fresh issue would be used to fund capital expenditure requirements, to support incremental working capital needs and repayment or prepayment of loans availed by the company.
•    Anand Rathi Advisors is the BRLM to the issue.
•    Link Intime India Private Limited is the registrar to the issue.

 

GoFirst (erstwhile GoAir)

Company Background:

Wadia Group-backed GoAir has been rebranded as 'Go First' as the airline is betting big on its ultra-low-cost business model to tide over the impact of the COVID-19 pandemic. Go Air is the third Indian carrier to be listed on the bourses after SpiceJet and IndiGo. The airline, which was launched in 2005, has a market share of more than 9.5% in India currently. The Go First as ULCC (ultra-low-cost carrier) would operate narrow-body aircraft type across its fleet, which comprises Airbus A320 and A320 Neos (new engine option) planes in operation.

GoFirst IPO Details:

•    The IPO will be worth ₹3,600 crores.
•    They aim to repay the debt of around ₹2,000 crores owned to Indian Oil Corp for jet fuel. 
•    The global coordinators and BRLMS to the issue are ICICI Securities, Citigroup Global Markets India Pvt Ltd, and Morgan Stanley India Company Pvt Ltd.
•    Link Intime India Private Limited is the registrar to the issue.

 

Seven Islands Shipping:

Company Background:

As of December 2020, Seven Islands Shipping is the third largest seaborne logistics company in India by deadweight tonnage. In 2020, the company held a significant market share in Indian time charters of crude oil imports (Source: CRISIL Report). The company is present in the liquid products trade where liquid products like white oils, black oils, lube oil and liquid chemicals are transported in product vessels classified as Small vessels, Medium Range or MR vessels and Long Range or LR vessels. It is also engaged in the crude oil logistics business where crude oil is transported in vessels classified as Aframax, Suezmax and Very Large Crude Carriers or VLCCs. Seven Islands Shipping oil products business is carried out through Small and MR vessels while our crude oil logistics business is currently carried out through Suezmax vessels.

Seven Islands Shipping IPO Details:

•    The IPO will be worth ₹600 crores.
•    The public issue comprises of fresh issue of ₹400 crore and an offer for sale up to ₹200 crore by FIH Mauritius Investments.
•    JM Financial Limited and IIFL Securities Ltd are BRLMs to the issue.
•    The net proceeds raised from fresh issue are to be utilised to acquire one very large crude carrier vessel and one medium range vessel from the secondary market and general corporate purposes.
•    Link Intime India Private Limited is the registrar to the issue.

 

Aadhar Housing Finance

Company Background:

Aadhar Housing Finance is the largest Affordable HFC in India in terms of AUM, as of March 31, 2020. It offers a range of mortgage-related loan products, including loans for residential property purchase and construction; home improvement and extension loans; and loans for commercial property construction and acquisition.

Aadhar Housing Finance IPO Details:

•    The IPO will be worth ₹7,300 crores.
•    The public issue comprises of a fresh issue worth ₹1,500 crores and the offer to sell up to ₹5,800 crore by the promoter. 
•    ICICI Securities Limited, Citigroup Global Markets India Private Limited, Nomura Financial Advisory and SBI Capital Markets Limited are BRLMs to the issue.
•    The net proceeds will be utilized towards augmenting its capital base to meet its future capital requirements.
•    KFin Technologies Private Limited is the registrar of the issue.

 

Ruchi Soya Industries:

Company Background:

Ruchi Soya Industries, a part of Patanjali Group, is one of the leading FMCG brands in the Indian edible oil sector. It is the largest manufacturers of soya foods with a presence across the entire value chain in upstream and downstream businesses with secured palm plantations.

Ruchi Soya FPO Details:

•    The IPO will be worth ₹4,300 crores.
•    The net proceeds will be utilized towards repayment and/or prepayment of the company's borrowings either partially or fully, funding working capital requirements and general corporate purposes.
•    SBI Capital Markets Limited, Axis Capital Limited, ICICI Securities Limited are the book running lead managers to the issue.
•    Link Intime India Private Limited is the registrar to the issue.

Disclaimer: The above report is compiled from information available on public platforms.

 

Also Read: Upcoming IPOs in 2021

How to increase the chances of IPO allotment

 

Further helpful: 

Ami Organics IPO Note

Vijaya Diagnostics IPO Note

 

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Ami Organics IPO: 7 Interesting Things to Know Before Investing

Ami Organics
27/08/2021

Ami Organics IPO opens for subscription on 01-Sep and closes on 03-Sep. Ami Organics manufactures specialized intermediates for the pharma industry (APIs) and also for the agrochemicals sector. The IPO of Rs.570 crore will consist of fresh issue of Rs.200 crore and offer for sale (OFS) of Rs.370 crore. Price band has been fixed at Rs.603-Rs.610.

7 Interesting facts about Ami Organics IPO

1)    Ami Organics is one of the leading manufacturers of key APIs including Dolutegravir, Trazodone, Entacapone, Nintedanib and Rivoraxaban. It has a leadership position in each of these specialized intermediates.

2)    Since its inception in 2004, Ami Organics has developed and commercialized 450 pharma intermediates for APIs across 17 therapeutic areas. It already has 8 patent applications that have been accepted and 3 applications that are pending.

3)    Ami Organics supplies APIs and specialty chemicals to over 150 customers spread across 25 countries, including India. Some of its marquee clients include Laurus Labs, Cadila, Cipla, Fermion OY, Sintetici SPA, Medichem SA and Midas Pharma GMBH.

4)    Over the last two financial years, the revenues of Ami Organics grew 43%, EBITDA by 90.45% and net profits by 131%. This resulted in net margins of the company expanding from 9.77% in FY19 to 15.85% in FY21.

5)    Nearly 70% of the fresh issue portion of Rs.200 crore will be utilized for repayment of loans. The loan repayment is expected to be completed in FY22 itself, to improve solvency ratios. The balance 30% will be used for working capital.

6)    Ami Organics has already done a Rs.100 crore pre-IPO placement to key investors including Plutus Wealth Management, Malabar India Fund, IIFL Special Opportunities Fund and Malabar Value Fund.

7)    Based on the post-issue indicative market cap of Rs.2,220 crore, the IPO price discounts the latest year earnings at a P/E ratio of 41X. That is reasonable considering that the peer group typically trades at a P/E of 50X to 70X.
 

Also Read: Upcoming IPOs in September 2021

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Ami Organics - IPO Note

IPO Note
29/08/2021

Ami Organics is a 17-year old company located in the state of Gujarat and specializing in the high growth segments of Active Pharma Ingredients (APIs) and specialty chemicals. Essentially, Ami Organics caters to the pharmaceuticals and the agrochemicals space and has over 150 clients spread across 25 nations including India. Ami organics operates through 3 plants; all located in Gujarat at Ankleshwar, Sachin and Jhagadia with total capacity of 6,060 MTPA (million tonnes per annum). Jhagadia and Ankleshwar were acquired in Mar-21 and are not reflected in FY21 results.

Ami Organics IPO is tapping the primary market with an IPO of Rs.570 crore consisting of a fresh issue of Rs.200 crore and an offer for sale (OFS) of Rs.370 crore. The IPO is priced in the band of Rs.603-610.

Key terms of the Ami Organics IPO offer

 

Key IPO Details

Particulars

Key IPO Dates

Particulars

Nature of issue

Book Building

Issue Opens on

01-Sep-2021

Face value of share

Rs.10 per share

Issue Closes on

03-Sep-2021

IPO Price Band

Rs.603 - Rs.610

Basis of Allotment date

08-Sep-2021

Market Lot

24 shares

Refund Initiation date

09-Sep-2021

Retail Investment limit

13 Lots (312 shares)

Credit to Demat

13-Sep-2021

Retail limit - Value

Rs.190,320

IPO Listing date

14-Sep-2021

Fresh Issue Size

Rs.200 crore

Pre issue promoter stake

47.23%

Offer for Sale Size

Rs.370 crore

Post issue promoters

41.05%

Total IPO Size

Rs.570 crore

Indicative valuation

Rs.2,225 crore

Listing on

BSE, NSE

HNI Quota

15%

QIB Quota

50%

Retail Quota

35%

Data Source: IPO Filings

Some highlights of Ami Organics core business

1.    It has a leadership position in most of the specific APIs it manufactures
2.    Commercialized over 450 pharma intermediates in 17 therapeutic areas
3.    Eight patent applications approved and 3 more in process
4.    Net margins improved from 9.77% to 15.85% over last 2 years
5.    Completed Rs.100 crore pre-IPO placement with marquee investors
6.    Pharma intermediates account for 88.4% of total revenues
7.    Pharma intermediates Trazodone and Dolutegravir top revenue contributors

Important Financials of Ami Organics

Ami Organics is a profit-making company with consistent growth in top-line revenues, bottom-line net profits and net profits margins. Its return on net worth (RONW) is way above the peer group.

 

Financial Parameter

Fiscal 2020-21

Fiscal 2019-20

Fiscal 2018-19

Net Worth

Rs.166.93 cr

Rs.111.81 cr

Rs.82.22 cr

Revenues

Rs.340.61 cr

Rs.239.64 cr

Rs.238.51 cr

EBITDA

Rs.80.15 cr

Rs.41.02 cr

Rs.42.08 cr

Net Profit

Rs.54.00 cr

Rs.27.47 cr

Rs.23.30 cr

Net Margins (%)

15.85%

11.46%

9.77%

EBITDA Margins (%)

23.53%

17.12%

17.64%

ROCE (%)

25.25%

22.40%

29.11%

RONW (%)

32.35%

24.57%

28.33%

Data Source: Company RHP


Across key ratios like net margins and return on equity, growth has been significant in FY21 over FY19. The only catch has been flat to lower ROCE. However, since a chunk of the fresh fundraising will be utilized for repayment of debt, the ROCE should improve in the coming quarters. Also, its capacity utilization at the Sachin facility is just 63% and an improvement will result in better-fixed cost absorption.

Currently, the capacity of the Ankleshwar plant and the Jhagadia plant have not been included as they were only acquired in March 2021. Once they also come on stream, the boost to the top line and the bottom line would be significant. Already, the RONW of Ami Organics is well above the peer group in the industry.

Investment Perspective for Ami Organics

Active Pharma Ingredient or APIs is a fast-growing segment globally. For a long time, China has been the global leader in the supply of pharma intermediates. However, post the pandemic and the supply chain constraints, most global pharmaceutical players are looking at India as a viable option. That opens up a big window of opportunity.

a)    Nearly 70% of the fresh issue proceeds will go towards repaying of debt. This will not only improve the solvency ratios of the company but also improve the ROCE ratios. This is likely to favorably impact valuations post the IPO.

b)    Among its top revenue-generating intermediates like Trazodone, Dolutegravir, Entacapone and Pazopanib, Ami Organics has an intermediates market share ranging from 70% to 85%, giving them leadership in these core segments.

c)    Ami Organics is likely to gain from high entry barriers in the pharma intermediates industry. Compliance requirements are stringent and in this area, the company has built solid entry barriers since it takes a long time to get enlisted as an API supplier.

d)    If you compare Ami Organics on the P/E ratio based on indicative post-issue valuations, it discounts FY21 profits at a P/E ratio of 41X. That is relatively attractive if you compare it with peer group companies like Aarti Industries and Vinati Organics.

Ami Organics brings to the table the combination of a solid financial track record, a commitment to reduce debt as well as smart entry barriers built up in the pharma intermediates business. The pricing is reasonable and Ami Organics may have the added advantage of being in the right industry at the right time.

Check: 7 Interesting Facts about Ami Organics
 

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Bharti Airtel to raise Rs.21,000 crore via Rights Issue

Bharti Airtel Rights Issue
29/08/2021

The board of Bharti Airtel has approved the issue of rights shares to the tune of Rs.21,000 crore or about $2.83 billion. The company has announced that the rights will be priced at Rs.535 per share, which represents a discount of 9.78% to the closing price of the stock on 27-Aug. Normally, companies issue rights to existing shareholders at an attractive discount to make the subscription attractive.

Bharti Airtel is yet to announce the record date for the rights issue because the rights offer will only be made to shareholders whose names appear in the register of shareholders as on the record date. Normally, 2 trading days prior to the record date is considered the last cum-rights date and the day after that, the stock starts trading ex-rights.

The board has already spelt out terms of payment for the rights issue. eligible shareholders will only have to pay 25% of the amount at the time of application of rights and the balance 75% will be payable in two instalments within a period of 36 months. The instalment dates are yet to be decided. Existing shareholders will get 1 rights share for every 14 shares held.

This will be the single biggest rights issue in India after the Rs.53,000 crore rights issue by Reliance Industries in 2020, which also entailed paying the rights subscription in 3 instalments. That means, Bharti shares will also trade simultaneously under partly-paid and fully-paid categories.

Promoters will fully subscribe to their quota of rights and will also take up any rights not taken up by other shareholders. Bharti Airtel needs a continuous supply of funds to take on competition from Reliance Jio as well as to pay the AGR dues of Rs.20,000 crore that is still pending to the Department of Telecommunications towards AGR charges. Rights proceeds will be used to bridge the funding gap.

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Sovereign Gold Bonds 6th Tranche opens on 30th August

Sovereign Gold Bonds
29/08/2021

The sixth tranche of the Sovereign Gold Bonds issue for FY22 (the last for H1) opens for subscription on 30-Aug and closes on 05-Sep. This SGB tranche is priced at Rs.4,732 per gram, which is lower than the fifth tranche. In addition, digital applications get an additional discount of Rs.50 per gram, so the effective price will be Rs.4,682 per gram.

Sovereign Gold Bond prices are linked to benchmark 24-carat gold prices in the Indian market and units equivalent to grams of gold are issued. The returns on gold bonds will depend on the price of gold but there is an assured interest of 2.50% per year payable semi-annually. The gold principal of SGBs and the interest are guaranteed by the government.

Also Read: Merit in Buying Digital Gold

Sovereign gold bonds can be held in physical certificate form or in your Demat account. These bonds have a maturity of 8 years but after 5 years the RBI offers a buyback window for investors. In addition, SGBs are also listed after a period of 6 months, although liquidity in secondary markets is quite thin. Only if SGBs are held till maturity, the capital gains are free of tax. Otherwise, gains will be taxed at non-equity rates. Interest will be fully taxable.

Investors can buy a minimum of 1 gram of gold equivalent and a maximum of 4 kg per person and 20 kg in the case of trusts in one year. However, multiple family members can each buy up to 4 kg in a year. These gold bonds can be purchased from designated post offices, from SHCIL, from the online broking platforms of BSE and NSE as well as through banks. However, payment banks and SFBs are not eligible to sell Sovereign Gold Bonds.

Since 2015, the government has sold gold bonds worth Rs.32,389 crore till date.
 

See: How to buy Digital Gold

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