Paradeep Phosphates Ltd. IPO
Paradeep Phosphates Ltd.
IPO Listing Details
Listed On
BSE & NSE
Listed On
Issue Price
₹42
Issue Price
Listing Price
₹44
Listing Price
Listing Gains
+₹1.55 (+3.69%)
Listing Gains
IPO Details
Bidding Dates
17 May - 19 May '22
Bidding Dates
Min. Investment
₹13,650
Min. Investment
Lot Size
350.00
Lot Size
Price Range
₹39 - ₹42
Price Range
Issue Size
1,394 Cr
Issue Size
Subscription Rate
- Retail Individual Investor1.37x
- Non-Institutional Investor0.82x
- Qualified Institutional Buyers3.01x
- Employees
About Company
Non-urea fertilizers manufacturer Paradeep Phosphates Ltd is set to launch its initial public offering on May 17. The company manufactures a variety of complex fertilisers such as three grades of Nitrogen-Phosphorus-Potassium, Di-Ammonium Phosphate (DAP), Phospho-gypsum, Hydroflorosilicic Acid and Zypmite.
For the nine months ended December 31, 2021, the company was the second-largest private sector manufacturer of non-urea fertilisers and DAP in terms of volume sales. The company markets its fertilisers under the brand names Jai Kisaan-Navratna and Navratna.
The company’s manufacturing facility located in Paradeep, Odisha, has a storage capacity of up to 120,000 MT, 65,000 MT, 55,000 MT and 35,000 MT of Phosphate Rock, Phosphoric acid, Sulphur and MOP, respectively.
Paradeep Phosphates IPO will open for subscription on May 17 and conclude on May 19. The company has fixed the price band for the issue at Rs 39-42 per share. The bidding for anchor investors will open on May 13, as per the Red Herring Prospectus (RHP). The government will sell its entire 19.55% stake in the company through the IPO.
The Rs 1,501.73-crore Paradeep Phosphates IPO comprises fresh issuance of equity shares worth Rs 1,004 crore and an offer for sale (OFS) of 11.85 crore shares by promoters and other selling shareholders.
In the OFS, Zuari Maroc Phosphates Pvt Ltd (ZMPPL) will sell 60,18,493 shares and the Government of India will offload up to 11,24,89,000 equity shares.
The company proposes to utilise the net proceeds from the fresh issue to part-finance the acquisition of the Goa facility, repayment or prepayment of certain borrowings and general corporate purposes.
The book running lead managers to the issue are Axis Capital, ICICI Securities, JM Financial and SBI Capital Markets.
Financial Snapshot - Paradeep Phosphates Limited IPO
Paradeep Phosphates has seen decent profit growth over the past three years. In the table provided below, you can get a snapshot of Paradeep Phosphates in recent years.
| Financial Year | Total Assets | Total Revenues | Profit After Tax |
|---|---|---|---|
| March 2019 | Rs 5,627.66 crore | Rs 4,397.21 crore | Rs 158.96 crore |
| March 2020 | Rs 5,010.33 crore | Rs 4,227.78 crore | Rs 193.22 crore |
| March 2021 | Rs 4,423.17 crore | Rs 5,183.94 crore | Rs 223.27 crore |
Important Dates - Paradeep Phosphates Limited IPO
| Application opens on | 17th May 2022 |
| Last date of application | 19th May 2022 |
| Date of Allotment | 24th May 2022 |
| Refund begins from | 25th May 2022 |
| Credit of shares to Demat | 26th May 2022 |
| Listing date | 27th May 2022 |
Paradeep Phosphates Limited IPO Grey Market Premium ( Data as per IPO Watch)
| Date | GMP |
|---|---|
| 10th May | Rs.35 |
| 9th May | Rs.30 |
Why should you invest in Paradeep Phosphates Ltd. IPO?
Paradeep Phosphates is the second-largest non-urea fertiliser maker in India. It has posted strong profit growth in recent years. Given the thrust on the agriculture sector by the government, Paradeep Phosphates may see decent growth in the future.
Paradeep Phosphates Ltd. IPO - SWOT Analysis
Strengths
Paradeep Phosphates is the second-largest Phosphatic fertilizers manufacturer in India. It is well-positioned to capture favourable Indian fertilizer industry dynamics supported by conducive government regulations. The company has secured and certified manufacturing facility and infrastructure and unutilised land available for expansion.
Weaknesses
The company’s business is highly dependent on the performance of the agricultural sector. Therefore, the business is subject to climatic conditions and is cyclical in nature. The company has historically derived a significant portion of revenues from operations from a limited number of states.
Opportunities
India is one of the largest fertiliser consumers in the world. Fragmentation of arable land resulting in higher cropping intensity is the key driver of fertilizer industry in India. Among the peer set considered, Paradeep Phosphates is among top four players in India in terms of production for non-urea segment. Given the prospects for the industry, the company has a lot of opportunities for growth.
Threats
The fertilizer industry in India is a regulated industry. Any change in Government policies towards the agriculture sector or a reduction in subsidies and incentives provided to farmers is a threat to the company’s business. There are outstanding litigations involving the company, its promoters and directors.
Paradeep Phosphates Noteworthy Highlights
Check out some of the key details and information about Paradeep Phosphates before investing:
- Paradeep Phosphates distributes its products across 14 states in the country.
- Its network includes 4,761 dealers and over 67,150 retailers serving over 5 million farmers in India.
- In the IPO, the company has reserved 50% of the offer for qualified institutional buyers (QIB), around 35% for retail investors and the remaining 15% for non-institutional investors (NII).
- The lot size of Paradeep Phosphates IPO is 350 shares and a retail-individual investor can apply for up to 13 lots.
A competitive analysis
The Indian fertilizer industry is highly fragmented and competitive. In its IPO document, Paradeep Phosphates has included many companies as its main competitors which include Coromandel International, Mangalore Chemicals and Fertilizers, Rashtriya Chemicals and Fertilizers, National Fertilizers, Gujarat State Fertilizers and Chemicals, Chambal Fertilizers and Chemicals, among others. Take a look at these direct competitors:
| Company Name | Market Capitalisation(Rs.Cr) | 1-Year Return |
|---|---|---|
| Coromandel International | 26,475 | 17.32% |
| Chambal Fertilizers and Chemicals | 17,242 | 61.79% |
| Gujarat State Fertilizers and Chemicals | 5,967 | 31.54% |
| RCF | 4,610 | -1.1% |
| National Fertilizers | 2,264 | -32.73% |
| Mangalore Chemicals and Fertilizers | 1,145 | 2% |
How to apply for Paradeep Phosphates Ltd. IPO?
You can apply for the Paradeep Phosphates Ltd. IPO in these ways:
UPI
Link your personal bank A/C to a trusted UPI ID and map it with your TradeSmart account. Now, proceed further to book your IPO. On acceptance of the mandate, the bid amount will get blocked in your bank account Learn more.
Demat Account
1. If you are an Existing TradeSmart demat account holder and wish to apply for an Paradeep Phosphates Ltd. click here.
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