The first public offering (IPO) from specialty chemicals manufacturer Aether Industries will hit primary markets on Tuesday, May 24. Aether Industries plans to raise close to Rs 808 crore through this IPO. Of this, Rs 627 crore will be raised through a new share issue while the remaining Rs 181.04 crore will be raised through an offer for sale (OFS). The tentative date for the announcement of the share allotment is May 31, 2022. The probable date for the listing of the shares is June 3.
Aether Industries IPO: Price Band and Lot Size
The price range of the company’s public issue is set at Rs 610-642 each. An investor can bid on a minimum of one lot of 23 shares, totaling Rs 14,766 per lot. The maximum bid can be placed for 13 lots, totaling Rs 191,958.
Aether Industries IPO: target
Aether plans to use Rs 627 crore in new issuance to fund the capital expenditures of Greenfield projects, repayment of outstanding loans and general corporate purposes.
Aether Industries IPO: Financials
Aether reported net profit growth of 18.45 percent over nine months ending December 2021, from 14.30 percent a year ago. However, sales fell to 49.04 percent for twelve months ending March 2021, from 50.02 percent in FY20.
Aether Industries IPO: GMP Today
In the gray market, shares of Aether Industries traded at a premium of Rs 10 over the higher price bracket. Once listed, Aether will join its peers such as Clean Science and Technology, Navin Fluorine International, Vinati Organics, PI Industries and Fine Organic Industries.
Aether Industries IPO: About the Company
Based in Surat, Gujarat, Aether Industries focuses on the production of advanced intermediates and specialty chemicals with complex, differentiated core competencies in chemistry and technology.
The company’s products are used in the pharmaceutical, agrochemical, materials science, coating, high-performance photography, additives, and oil and gas segments of the chemical industry.
Aether Industries IPO: Should You Subscribe?
Real estate agency Religare Broking believes the company is well positioned to capitalize on growing industry trends, given its differentiated portfolio of market-leading products. A constant focus on research and development (R&D) and a long-term diversified customer base will help the company outpace the industry’s growth.
Analysts believe the Indian specialty chemicals market is expected to grow at an 11.2 percent CAGR over CY20-25. As a result, the company is poised to take advantage of expanding its product portfolio and diversifying into other business segments.
However, the brokerage firm believes that despite strong financial performance, valuations appear expensive at ~71x FY22 yoy after earnings per share. Volatile commodity prices and high debt levels continue to overshadow the company’s performance; therefore, the brokerage firm recommended a ‘neutral’ stance on the IPO.
Analysts at Angel One believe that Aether Industries’ IPO valuations appear reasonable given the historic top-line and bottom-line CAGR of ~50 percent and ~75 percent, respectively, over FY19-21. Aether’s diversified customer base, strong financial track record and higher return on equity make it a favorable subscription, it said. Therefore, the brokerage firm advised ‘subscribe’ ratings on the matter.
The expert opinions and investment tips in this News18.com report are their own and not the website’s or its management. Users are advised to contact certified experts before making any investment decisions.
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