Anupam Rasayan fails to dazzle on its stock market debut – shares down by nearly 8% soon after listing

• Shares of Anupam Rasayan listed on the stock exchanges at ₹520 per share, which is over 6% lower than the issue price.
• The company’s initial public offer (IPO) was oversubscribed by 44 times.
• It intends to use a bulk of the proceeds of the IPO towards repaying its debts.

Shares of Anupam Rasayan, the latest company to get listed on the Indian stock exchanges, debuted at ₹520 per share, which is more than 6% below its issue price of ₹555.

The specialty chemical maker floated its ₹760 crore initial public offer (IPO) earlier this month. The IPO was oversubscribed by 44 times, with non-institutional investors leading the fray.

At the time (10:05 am) of writing, the company’s shares were trading at ₹512 per share, which is down by nearly 8%.

The Surat-based Anupam Rasayan plans to repay its debts worth ₹556.20 crore from the proceeds of the IPO. Its total debts amount to ₹814.48 crore.

The grey market premium for Anupam Rasayan’s shares was hovering around the ₹65-70 mark, which translates to approximately 12% of the issue price of ₹555. It is worth noting that grey market premium is not an official measure of market premium.

Anupam Rasayan commenced operations in 1984 with conventional products, and now it makes specialty chemicals that involve multi-step synthesis and complex chemistries.

The company’s business is divided in two verticals – life science related to specialty chemicals and other specialty chemicals.

In its IPO note, HDFC Securities stated that Anupam Rasayan’s business and customer-base is diversified across industries, which shields it from the market uncertainties.

“Its customers are typically engaged in various industries, including agrochemicals, personal care, pharmaceuticals, specialty pigments and dyes, and polymer additives, and spread across various geographies, which helps it mitigate risks resulting from customer, industry and geographic concentration,” said HDFC Securities in its report.

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