Paradeep Phosphates IPO opens today — GMP already at ₹3 per share

Advertisement
Paradeep Phosphates IPO opens today — GMP already at ₹3 per share
Paradeep Phosphates
  • The fertilizer company will open its IPO on May 17 and will close on May 19.
  • The price band of the IPO is ₹39 - ₹42 per share.
  • Shares of the company are already demanding a premium of ₹3 per share in the grey market, which is 10% on the issue price.
Advertisement
The fertilizer company will open its initial public offering (IPO) on May 17 and will close on May 19.

The IPO consists of a fresh issue of shares worth ₹1,501 crore and an offer for sale of 11.85 crore shares by promoters and shareholders of the company.

The company is primarily engaged in manufacturing, trading, distribution and sales of a variety of complex fertilizers such as Di-Ammonium Phosphate (DAP), three grades of Nitrogen-Phosphorus-Potassium (NPK), Zypmite, Phospho-gypsum and Hydroflorosilicic Acid (HFSA).

It caters to farmers across the country through its fertilizers marketed under the brand names Jai Kisaan-Navratna and Navratna.

Shares of the company are demanding a premium of ₹3 per share in the grey market, which is 10% on the issue price. Grey market is the unofficial market where shares are traded before they are either offered or listed.

Advertisement

Here are some of the important dates related to the IPO:
Issue details
Price band₹39 to ₹42
IPO open dateMay 17
IPO close dateMay 19
Allotment dateMay 24
Initiation of refundsMay 25
Credit of shares to demat accountMay 26
IPO listing dateMay 27
Minimum lot350

“Given the fact that the company is valued in line (Chambal fertilizer and Deepak fertilizer) with peers and likely to face headwinds in terms of cost pressures due to recent increase in raw material prices, we recommend a NEUTRAL rating on the issue,” said a report by Angel One.

The fertilizer company’s performance has been improving steadily for the last three financial years.
YearRevenueProfit
FY21₹5,183 crore ₹223 crore
FY20₹4,227 crore ₹193 crore
FY19₹4,397 crore ₹158 crore
(Source: Red Herring Prospectus)

However, the company has a long way to go in comparison to its peers, who are more profitable and have more diversified chemical businesses.
Companies Profit after tax (FY21)
Chambal Fertilisers and Chemicals₹13.5 billion
Coromandel International₹13.1 billion
Gujarat State Fertilizers & Chemicals₹4.2 billion
Rashtriya Chemicals and Fertilizers₹3.7 billion
National Fertilizers₹2.5 billion
Paradeep Phosphates₹2.2 billion
Deepak Fertilisers and Petrochemicals Corporation₹2.1 billion
Mangalore Chemicals & Fertilizers ₹0.7 billion


Advertisement
SEE ALSO: Three new IPOs opening this week — Paradeep Phosphates, Ethos, eMudhra while LIC to list on exchanges tomorrow
Top 10 most valuable startups in India
Adani Group companies will benefit through backward integration with buyout of two major cement firms — Ambuja Cements, ACC
{{}}