Paradeep Phosphates IPO last day: Today is your last chance to subscribe to the Initial Public Offering (IPO) of Paradeep Phosphates, the second largest private sector manufacturer of non-urea fertilizers and diammonium phosphates (DAP) in India. The Paradeep IPO has been open for subscription since May 17 and closes today, May 19. The fertilizer company has set the price range of its public offer at Rs 39 to Rs 42 per share of its share. The company plans to use Rs 1,004 crore proceeds from its new issues to partially finance the acquisition of a fertilizer plant in Goa and debt repayment.
Paradeep Phosphates IPO: Subscription status
Data on NSE showed that the Paradeep IPO received cumulative bids of 13,63,79,600 shares against the tender size of 26,86,76,858 shares – bids up 51 percent. The issuance was closed by private retail investors (RIIs) as a 95 percent subscribed class with offers of 12,49,10,100 shares on a consolidated basis against the reserved portion of 13,15,80,187 shares.
On the other hand, the portion held for non-institutional investors subscribed at just 20 percent against the reserved size. However, there were hardly any demands from qualified institutional buyers (QIBs) as on day 2 – bids of just 14,700 shares were made by the class against the reserved size of 8,07,05,162 shares. FIIs, DIIs and mutual funds have not bid on the IPO so far.
Under the IPO, 50 percent of the total size is reserved for QIBs, 15 percent is retained for NIIs, and the remaining 35 percent is allocated to RIIs. The IPO is a 100 percent book building and has a price range of Rs 39 to Rs 42 per share share. The bid lot is in 350 treasury shares and in multiples thereof.
Paradeep Phosphates IPO: Financials
In the first 9 months of FY22, Paradeep Phosphates Limited has reported a net profit of Rs 362.78 crore while the turnover during this period is Rs 5973.69 crore. The fertilizer making company has reported net profit of Rs 158.96 crore on sales of Rs 4397.21 crore in FY19 while net profit rose to Rs 193.22 crore in FY2020. In FY21, Paradeep Phosphates Limited reported a net profit of Rs 223.27 crore against net sales of Rs 5183.94 crore, according to an IIFL report. Thus, the company has recorded continuous profit increases for the past three fiscal periods.
Established in December 1981, Paradeep Phosphates is mainly engaged in manufacturing, trading, distributing and selling a variety of complex fertilizers such as DAP, three types of Nitrogen-Phosphorus-Potassium (NPK), namely NPK-10, NPK-12 and NP-20, zypmite, phosphogypsum and hydroflorosilicon acid (HFSA).
Paradeep Phosphates IPO: GMP today
According to gray market observers, Paradeep Phosphates IPO GMP (Gray Market Premium) today is Rs 3, which is unchanged from yesterday’s gray market premium. Market observers said Paradeep Phosphates IPO GMP today is Rs 3, meaning the gray market expects Paradeep Phosphates’ IPO listing to be around Rs 45 (Rs 42 + Rs 3), which is about 7 percent higher than the price range of Paradeep Phosphates IPO.
Paradeep Phosphates IPO: Should You Invest?
Astha Jain, Senior Research Analyst at Hem Securities, gives a subscription label to Paradeep Phosphates IPO: “The company is launching the issue at a price range of Rs 39-42 per share at a p/e multiple of 11x based on FY21 eps. The company is the second largest private sector manufacturer of phosphate fertilizers in India and is well positioned to leverage the favorable dynamics of the Indian fertilizer industry, supported by favorable government regulations.Company with an established brand name, supported by an extensive sales and distribution network, has a strong heritage, an experienced management team and prominent shareholders looking for a good investment opportunity for long-term investments, so we recommend that you “Subscribe” on issue for the long term.
Disclaimer: The expert opinions and investment tips contained in this News18.com report are their own and not the website or its management. Users are advised to contact certified experts before making any investment decisions.
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