Ami Organics Ltd IPO

Current

IPO Synopsis

The offer comprises a fresh issue and an offer for sale. The fresh issue is of ₹200cr after the company chose the pre-IPO placement of ₹100 cr. 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 offer for sale is 6,059,600 shares amounting to ₹369.6cr, the proceeds of which would go directly to the selling shareholders.

Ami Organics Shareholding

% Shareholding

Pre- IPO(%)

Post-IPO(%)

Promoter & Promoter Group

47.22

41.00

Public

52.78

59.00

Source: RHP

About Ami Organics Ltd

Ami Organics Limited is a research and development (‘R&D’) driven manufacturer of specialty chemicals with varied end usage, focusing 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 their recent acquisition of the business of Gujarat Organics Limited (‘GOL’). The Pharma Intermediates which we manufacture, 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.

Key Points

Competitive Strengths:

Some of the competitive strengths are as follows

1.  Diversified product portfolio ably supported by strong R&D and process chemistry skills.
Based on the existing business strategy of early identification of molecules for development and supply, Ami Organics has developed and commercialised over 450 Pharma Intermediates for APIs including Dolutegravir, Trazodone, Entacapone, Nintedanib and Rivaroxaban and NCEs across 17 high growth therapeutic areas since inception, such as anti-retroviral, anti-inflammatory, anti-psychotic, anti-cancer, anti-Parkinson, anti-depressant and anti-coagulant. As a result of their R&D capabilities, the company has been able to file eight process innovation patent applications in India applications (in respect of intermediates used in the manufacture of Apixaban, Rivaroxaban, Nintedanib, Vortioxetine, Selexipag, Pimavanserin, Efinaconazole and Eliglustat).

2. Extensive geographical presence and diversified customer base with long standing relationships
Ami Organics caters to domestic and certain multi-national pharmaceutical companies which cater to the large and fast-growing markets of Europe, China, Japan, Israel, UK, Latin America and the USA. In FY21 the company’s revenue from exports contributed 51.57% of the total revenue from operations. The company supplies their products to 25 countries and has long-standing relationships with     numerous domestic and global pharmaceutical companies. Diversification of their customer base across the domestic and global markets has limited the company’s exposure to a risk of concentration, enabling them to further diversify and expand their business relationships. Thirteen of Ami Organic’s customers have been their customers since the past 10 years and fifty of their customers have been customers since the past five years.

3. High entry barriers in the chemicals manufacturing industry
The pharmaceutical intermediates business has high entry barriers inter alia due to: (a) a long gestation period to be enlisted as a supplier with the customers, particularly with the customers in US and European countries, which requires suppliers to adhere to strict compliance requirements, leading to a high regulatory gestation period; and (b) the involvement of complex chemistries in the manufacturing process, which is difficult to commercialize on a large scale. APIs and NCEs manufactured by Ami Organic’s customers, where their products are used, and where such use has been formally recognised in filings with regulatory agencies, any change in the vendor of the product may require significant time and cost for the customer resulting in a propensity amongst customers to continue with the same set of suppliers. This highlights the high entry barriers in the industry in which they operate.

Risk Factors:
Some of the risk factors are as follows

1.    The continuing impact of the COVID-19 pandemic on their business and operations is uncertain and it may be significant and continue to have an adverse effect on their business.
2.    The company is subjected to strict quality requirements, regular inspections and audits, and any failure or quality control problems can damage their reputation and have an adverse effect on their business.
3.    Non-compliance with and adverse changes in health, safety, labour, and environmental laws and other similar regulations applicable to their manufacturing operations may adversely affect their business.

 

Ami Organics 5paisa Review

Considering the future growth potential of the specialty chemical industry, plans for strategic acquisition and expansions, diversified products and customer base, and strong technical capabilities of the company, we recommend ‘Subscribe’ to the issue with a long-term perspective.

How to Apply for an IPO?

  • Login to your 5paisa account and select the issue in the current IPO section

    Login to your 5paisa account and select the issue in the current IPO section

  • Enter the number of lots and price at which you wish to apply for

    Enter the number of lots and price at which you wish to apply for

  • Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange

    Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange

  • You will receive a mandate notification to block funds in your UPI app

    You will receive a mandate notification to block funds in your UPI app

  • You will receive a mandate notification to block funds in your UPI app

    You will receive a mandate notification to block funds in your UPI app

Don’t have a Demat account? Open one with 5paisa today!

Keep your documents and get your account activated to start applying for Ami Organics Ltd IPOs in just few hours.

Frequently Asked Questions

An Initial Public Offering OR IPO is the process of issuing stock for sale for the first time by a private corporation to the public. A company can issue its stock for sale for the first time to raise money by issuing either debt or equity. In case, the company chooses the equity route, the first such offering of equity shares to the public via listing of the shares in the stock markets is called an IPO.

 

This is one of the processes that has to do with the pricing of the IPO. An IPO can be made either through book building method, the fixed price method or a combination of both.

While in book building the price at which securities will be offered/allotted is not known in advance to the investor (investor is aware of an indicative price range only), in the fixed price process price at which the securities are offered/allotted is known in advance to the investor.

When it comes to an IPO, there are 4 types of investors who can bid, as per SEBI guidelines. They are –

  1. Qualified institutional investors (QIIs)
  2. Anchor investors
  3. Retail investors and
  4. High net-worth individuals (HNIs)/Non-institutional investors (NII).

 

IPO subscription period is the period of time during which investors can promise to purchase shares of a security to be issued as initial public offering (IPO).

Check: IPO Application Process

For details about the new IPO application process, click here.

To apply in an IPO with 5paisa:

  • Login to the 5paisa website or mobile trading app
  • Go to the Current IPOs section
  • Select the IPO you wish to apply for
  • Enter IPO details like price, quantity (lots) and your UPI ID
  • Check details and Confirm
  • Approve the UPI notification received on your phone (in BHIM App or your net banking app)

A Red Herring Prospectus, or offer document, is filed by a company to SEBI. This document is very useful to as it provides detailed information about the company’s business operations, financials, promoters and the company’s objective for raising funds.

Contact Details of Ami Organics Ltd IPO

Contact Information

Address

Ami Organics Limited
Plot No. 440/4, 5 & 6, Road No. 82/A
GIDC Sachin, Surat – 394 230


Phone: +91 261 239 7193
Email: cs@amiorganics.com
Website: http://www.amiorganics.com/

Ami Organics Ltd IPO Lead Manager

Link Intime India Private Ltd
 Link Intime India Private Ltd
 C 101, 247 Park, L.B.S.Marg,
 Vikhroli (West), Mumbai - 400083

Phone: +91-22-4918 6270
Email: amiorganics.ipo@linkintime.co.in
Website: http://www.linkintime.co.in

Have more question about Ami Organics Ltd IPO?

Join 5paisa community and ask your questions