Last Updated on October 26, 2023 by BFSLTeam BFSLTeam
Gujarat-based chemical manufacturer, Gujarat Polysol Chemicals Ltd, which filed its DRHP back in March 2022 has received its approval from SEBI for its Rs. 414 crore IPO. It has proposed to utilise its fresh issue proceeds for settling a certain amount of company debt. INGA Ventures Private Ltd is the book-running lead manager of this IPO.
If you are looking forward to investing in the chemical sector, you can consider investing in Gujarat Polysol Chemicals Ltd IPO. Read along to know the line of business, competitive strengths, risk factors, IPO objective and financial summary of the company.
Table of Content
About Gujarat Polysol Chemicals Ltd
Gujarat Polysol Chemicals Ltd, a Gujarat-based chemical manufacturing company is one of the largest chemical manufacturers for the infra-tech leather, dyes and agro sectors. It is among the leading suppliers of dispersing agents in India, offering products such as Gujmol PDN and Gujmol SNF-D1 to D4 for different end-usage. It is one of the largest suppliers of powder surfactants in India.
The company is known for being one of a few PCE (polycarboxylate ether) manufacturers in the world and the only PEC manufacturer in India. It has been in the business of chemical manufacturing for over three decades with its core strengths being continuous augmentation of its product offerings.
It has its manufacturing facilities located in four strategic locations of Gujarat, Daman & Diu and Dadra & Nagar Haveli with an average production capacity of 184,400 metric tonnes in a year.
IPO Details and Objectives
Gujarat Polysol Chemicals Limited is preparing to launch an IPO and has filed its offer documents with SEBI. It has proposed to raise approximately Rs. 414 crore out of which Rs. 327 crore is the offer-for-sale and Rs. 87 crore is the fresh issue.
The selling shareholders are entitled to receive all the proceeds from the offer-for-sale after paying out the applicable taxes.
Gujarat Polysol Chemicals Ltd has proposed the following objectives for the fresh issue:
- To make repayment or prepayment of certain outstanding borrowing made by the company
- To meet any expenses related to general corporate purposes
Also Read: Benefits of Investing in IPO
Company Financials
Here is the financial summary of Gujarat Polysol Chemicals Limited for the financial years 2021, 2020, and 2019.
| Particulars | For the Financial Year Ending (Rs. Millions Except EPS) | ||
| March 31, 2021 | March 31, 2020 | March 31, 2019 | |
| Total Assets | 3,144.79 | 2,664.86 | 2,735.35 |
| Total Liabilities | 1,725.93 | 1,729.15 | 2,002.13 |
| Total Expenses | 3,261.32 | 4,148.55 | 4,207.01 |
| Total Revenue | 3,804.32 | 4,409.38 | 4,397.98 |
| Profit/Loss After Tax | 398.39 | 201.85 | 128.00 |
| EBITDA | 642.99 | 386.82 | 318.61 |
| EPS (Basic and Diluted) | (Basic) 20.98(Diluted) 19.77 | (Basic) 15.30(Diluted) 10.02 | (Basic) 9.77(Diluted) 6.38 |
Strengths of Gujarat Polysol Chemicals Ltd
Here are some of the strengths of Gujarat Polysol Chemicals:
- Gujarat Polysol Chemicals Ltd has developed a strong and well-diversified customer base. Its consumer-centric approach helps differentiate it from other players in the market.
- It has a constant focus and makes significant investments in its research & development. This enables the company to formulate new innovative products, which can help in playing an integral role in the life cycle of a product.
- Gujarat Polysol has substantial manufacturing capacity with three manufacturing units situated in Sarigam and Vapi in Gujarat and others in Dadra & Nagar Haveli and Daman and Diu. It uses stringent quality check protocols to ensure that the products are of the highest quality.
- It has well-experienced promoters with strong leadership skills and significant industry experience. The promoters have a cumulative industry experience of more than four decades. Also, the company’s senior management team has employees who are highly qualified, skilled and have many years of experience; thus, it’s capable of bringing unmatched value to the company.
Risks Involved in Gujarat Polysol Chemicals Ltd
Here are some of the risk factors associated with the business activities of Gujarat Polysol Chemicals:
- Gujarat Polysol Chemicals does not have long-term agreements with its suppliers; therefore, failure to procure raw materials in sufficient quantities can directly affect its operations, turnover and ultimately profitability.
- It is heavily dependent on a handful of clients; failure to maintain a good relationship with these selected clients can directly impact operations and profitability.
- Failure to comply with the stringent regulations or inability to maintain quality standards can directly impact its business.
Also Read: Risk of investing in IPO
Summary
To summarise, Gujarat Polysol Chemicals is one of the leading chemical manufacturing companies in India for certain industries. The company wants to raise around Rs. 4,140 million to repay certain loans; having received SEBI’s approval, it is preparing to launch its IPO shortly.
Consider checking its updated financial performance for FY 22 and FY 23 which are yet to be disclosed by the company. Also consider checking its strengths, risk factors, and IPO objectives to make an informed decision.
Frequently Asked Questions
For the offer-for-sale, the selling shareholders are: Shaileshkumar Balvantrai Desai, M/s. Polysol Financial Services LLP, Umang Shailesh Desai and M/s. Apurva International.
There are two group companies under Gujarat Polysol, namely Menumate India Private Limited (MIPL) and Polysol Specialty Chemicals Private Limited (PSCPL).
Umang Shailesh Desai and Shaileshkumar Balvantrai Desai are the two promoters, Shaileshkumar Balvantrai Desai also being the managing director of the company.
The IPO opening and closing dates are yet to be announced by the company.
Link Intime India Private Ltd is the registrar of the offer.
