Survival Technologies Ltd IPO

Recently, Survival Technologies Ltd has received SEBI’s approval to launch its IPO. The company filed its DRHP with the market regulator on 28^th December 2022. It is yet to be announced when the IPO is going to be open for subscription. 

Thus, now is the best time for investors to research the company, know its strengths and weaknesses and decide whether it is worth investing in. To learn more about the Survival Technologies Pvt Ltd IPO, keep reading.

About the Company- Survival Technologies 

Survival Technologies Pvt Ltd provides contract research and manufacturing services (CRAMS). It focuses mainly on the speciality chemicals manufacturing sector and is one of the market leaders in this regard. 

This company supplies speciality chemicals which have multiple applications. Some of its products act as import substitutes, which were earlier imported from China. Furthermore, it belongs to the list of selected speciality chemical manufacturers which manufacture chemicals from the fluoro and heterocyclic organic product groups for domestic and international sale.

The company’s services cater to all aspects of its customers’ product life cycles. It conducts extensive in-house research for product development, along with process development and manufacturing to meet their commercial requirements.

From 1^st April 2007 to 31^st March 2022, it has developed 677 products, out of which more than 500 have been produced commercially and sold to customers across the globe. 

Furthermore, thanks to its strong R&D facilities, Survival Technologies is the only Indian company developing niche products like 4-dichloro pyrimidine, 5-bromo-2, 2-pyridyl tribromomethyl sulfone, etc., on a commercial scale. It also provides custom manufacturing options from its existing product offerings.  

Survival Technologies Ltd IPO Details

Survival Technologies Pvt Ltd has declared a fresh issue size of Rs. 200 crore and an offer for sale size of Rs. 800 crore by promoters for its public issue. Each share will have a face value of Rs. 2 and will be listed on both the NSE and the BSE. 

JM Financial Limited and ICICI Securities Limited will serve as the book-running lead managers for this IPO. Nimai Vijay Agrawal and Vijaykumar Raghunandanprasad Agrawal are the promoters for this offer, while Link Intime India Private Limited is the registrar. 

Survival Technologies is yet to release the tentative dates regarding IPO bid opening, closing and anchor investor bidding. Moreover, it will declare the IPO’s lot size, price band, etc. after consulting its book-running lead managers. 

Also Read: IPO investment strategy

Survival Technologies Ltd IPO Objectives

With the funds generated from the Survival Technologies Pvt Ltd IPO, the company aims to fund additional working capital requirements. As per its DRHP, an amount equal to Rs. 175 crore from its fresh issue proceeds would be used for this purpose. It will help Survival Technologies fund its future growth and meet additional demand for its products.

The remaining amount out of the Rs. 200 crore fresh issue would be used for general corporate purposes. For the OFS part of this IPO, the company will not receive any proceeds but it will benefit from improvement in visibility and brand image. The entire proceeds will go to the selling shareholders after offer-related expenses are deducted.

Also Read: How To Apply For An IPO?

Strengths

In order to make an informed investment choice, knowing the strengths and weaknesses of a company is crucial. Find the strengths of Survival technologies mentioned below:

• It’s one of the biggest contract research and manufacturing service companies in India, serving in the speciality chemicals sector. 
• The manufacturer deals in all types of complex chemicals, including ones from the fluoro and heterocyclic product categories which are a niche in this segment. 
• Strong in-house R&D capabilities allow the company to manufacture customised products while reducing production costs. 
• The presence of high entry barriers in contract research and manufacturing of speciality chemicals ensures low market competition. 
• Long-standing relationships with several leading national and international players like Dr. Reddy’s Laboratories, Godrej, Sai Life Sciences Limited, Evonik, Alzchem Trostberg GmbH, Sumitomo Corporation, etc. 
• Consistent growth in revenue from operations between FY 2020 to 2020, with the figures rising from Rs. 1,99.146 crore to Rs. 3,11.782 crore, indicating a 25.12% CAGR. 

Risks

Here are the risks of investing in the Survival Technologies IPO:

• The company does business on a purchase-order basis. Thus, any loss or reduction in demand from its client’s end can significantly affect its business and cash flow. 
• Survival Technologies sources its raw materials from third-party suppliers. If there is a fall in quality or quantity from their end, it can have a negative impact on the company’s profits and operations. 
• Prolonged delays in manufacturing can lead to heavy losses. Disruptions like worker strikes, accidents, fires, power failures, earthquakes or political disturbances can halt operations indefinitely. 

Also Read: Risk of investing in IPO

Conclusion

Now that you have a clear idea of the Survival Technologies Pvt Ltd IPO, you can make an informed choice of whether to invest in this company. Consider keeping a tab on our website to stay informed of the IPO opening and closing dates. 

Furthermore, you can open a Demat and trading account with us to ensure that you can invest in this public issue as soon as it goes live.  

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