JG Chemicals to Launch Rs 251.19 Crore IPO on March 5: Key Details Revealed

JG Chemicals, a manufacturer of zinc oxide, is entering the primary markets with a public offer worth Rs 251.19 crore, set to open on March 5. The anchor book will open for a day on March 4.

Here are the key details of the offer:

1. IPO Dates: The IPO will open for subscription from March 5 to March 7, 2024.
2. Price Band: The price band for the public offer is fixed at Rs 210-221 per share.
3. Offer Details: The offer comprises fresh shares worth Rs 165 crore by the company and an offer-for-sale (OFS) of 39 lakh equity shares by promoters. Promoters including Vision Projects & Finvest, Jayanti Commercial, Suresh Kumar Jhunjhunwala (HUF), and Anirudh Jhunjhunwala (HUF) will be the selling shareholders. Half of the issue size is reserved for qualified institutional buyers, 15 percent for non-institutional investors, and 35 percent for retail individual investors.
4. Objectives of the Issue: The company plans to allocate Rs 91.06 crore to its material subsidiary, BDJ Oxides, and allocate Rs 35 crore for long-term working capital requirements. The remaining funds will be used for general corporate purposes.
5. Lot Size: Investors can bid for a minimum of 67 equity shares and in multiples thereof.
6. Company Profile: JG Chemicals manufactures zinc oxide used in various industrial applications such as ceramics, paints, pharmaceuticals, electronics, agrochemicals, lubricants, and animal feed. It operates three manufacturing facilities in Kolkata, West Bengal, and Naidupeta, Andhra Pradesh.
7. Financials: For FY23, the company recorded a consolidated net profit of Rs 56.8 crore, growing 31.7% over the previous year, with revenue from operations rising by 28% to Rs 784.6 crore. EBITDA for the year grew by 34.4% to Rs 75.5 crore.
8. Lead Managers: Centrum Capital Limited, Emkay Global Financial Services Ltd, and Keynote Financial Services Ltd are the book-running lead managers, while Kfin Technologies Limited is the registrar for the issue.
9. Key Risks: The company’s business is heavily reliant on the sale of zinc oxide, and any reduction in demand may impact its financial performance. Dependency on select customers, procurement of raw materials from overseas suppliers without long-term agreements, and reliance on third-party transportation are other significant risks.
10. Listing Date: The IPO is likely to list on the BSE and NSE on March 13, 2024.