Laxmi Organic Industries: Lakshmi Organic Industries, a company that makes speciality chemicals, is also preparing for an IPO. The company has applied to the market regulator Sebi for an initial public offering (IPO) of Rs 800 crore. According to the draft red herring prospectus submitted to SEBI, an offer has been made to issue new shares worth Rs 500 crore in the IPO. While the promoter Yellow Stone Trust also offered to sell shares worth Rs 300 crore.
Company Business
The company manufactures acetyl and related chemicals. It is the largest ethanol acetate making firm in the country. Lakshmi Organics has a strong product portfolio. The company has a 30 per cent share of the ethyl acetate market in India, while 55 per cent of the dictetone derivatives market. The company supplies its products to well-known customers like Alembic Pharma, Dr. Reddy’s Labs, Hetero Labs, Loser Labs, McLeods Pharma, Mylan Labs, Newland Labs, Suven Pharma, Sudarshan Chemicals and Granules India.
2 companies making chemicals have launched IPO in 2020
Earlier this year, 2 companies making chemicals, Rosary Biotak and Chemcon Specialty, have brought their IPO. Both companies received strong response from investors. While Rosary Biotech received 80 times subscription, Chemcon Specialty got 149 times subscription. After the success of the IPOs of these companies, Lakshmi Organics has also planned to launch an IPO.
Company customers in 30 countries
Lakshmi Organics has a presence in domestic markets as well as in overseas markets. The company has customers in nearly 30 countries. China, Russia, Netherlands, Singapore, UK, US and UAE are the major countries. Axis Capital and DAM Capital Advisor have been appointed book running lead managers for the IPO. Many products of the company are in demand in many industries. For example industries like agro chem, dye and pigments, ink and coating, paint printing and packaging, flavours and fragrances.
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Will use in capital expenditure
The company will use the proceeds from this issue for capital expenditure, in which the production unit of Fluoro Specialty Chemical is the head. Apart from this, the company will also use the money for plant and machinery. The remaining amount remaining from the issue will be used for working capital requirements and general corporate needs.
Source: www.financialexpress.com