IPO Analysis : Chemcon Speciality Chemicals Limited

IPO Analysis : Chemcon Speciality Chemicals Limited

About Company:

Chemcon is a manufacturer of specialized chemicals, such as HMDS and CMIC which are predominantly used in the pharmaceuticals industry, and inorganic bromides, namely Calcium Bromide, Zinc Bromide and Sodium Bromide, which are used as completion fluids in the oilfields industry. The company is the only manufacturer of HMDS in India and is the eighth largest manufacturer of HMDS worldwide in terms of production in 2018. It is the largest manufacturer of CMIC in India and the second largest manufacturer of CMIC worldwide, in terms of production and capacity in calendar year 2018. Further, it is the only manufacturer of Zinc Bromide and the largest manufacturer of Calcium Bromide in India, in terms of production in 2018.

The company supplies its products to domestic customers and also exports its products to countries including United States of America, People’s Republic of China, Japan, United Arab Emirates, Azerbaijan, Serbia, Russia and Malaysia. In FY2019, 2018 and 2017, its revenue from exports (including Deemed Exports) contributed 32.23%, 48.06% and 65.09% respectively of its revenue from operations, growing at a CAGR of 29.44% between FY2017 and FY2019.

The key customers of its Pharmaceutical Chemicals include Hetero Labs Limited, Laurus Labs Limited, Aurobindo Pharma Limited, Sanjay Chemicals (India) Private Limited, Lantech Pharmaceuticals Limited, Ind-Swift Laboratories Limited, Vivin Drugs & Pharmaceuticals Limited, Macleods Pharmaceuticals Limited and the key customers of Oilwell Completion Chemicals include Shree Radha Overseas, Water Systems Specialty Chemical DMCC, Universal Drilling Fluids and CC Gran Limited Liability Company.

Competitive Strengths:

• Largest manufacturer of pharmaceutical chemicals across the globe.

• Leading oilfield chemicals manufacturer in India.

• Diversified clientele base in the domestic and global markets.

• Strong and consistent financial performance.

• Dedicated manufacturing plants for each product.

Objective of the Issue:

• To meet capital expenditures for expansion of manufacturing facility.

• To meet business working capital requirements.

• To meet general corporate purposes.

Important Date & Schedule:

Verdict:

In my view, specialty chemical is a fancy show now a days, hence application should be made only for listing gains. Not a good IPO for long term. 

Sources: Various publications

Disclaimer: The information provided herein is based on publicly available information and other sources believed to be reliable, but involve uncertainties that could cause actual events to differ materially from those expressed or implied in such statements. The document is given for general and information purpose and is neither an investment advice nor an offer to sell nor a solicitation. While due care has been exercised while preparing this document, we do not warrant the completeness or accuracy of the information. We will not accept any liability arising from the use of this material. The recipient of this material should rely on their investigations and take their own professional advice.

Follow, Like, subscribe and share 

"Your Trust, Our Financial Expertise."

Infyture, Investment For Your Future

Email: infyture@gmail.com

Website: http://infyture.wordpress.com

Facebook Page: https://www.facebook.com/infyture4future/

Youtube:https://www.youtube.com/channel/UCjOxVGTKQiK5O0mdcuMBCdw?view_as=subscriber

Blogger: https://infyture.blogspot.com/

Financial Planning || Equity Tip || Demat Account || Mutual Fund Investment || Life Insurance || General & Health Insurance || PMS & mini PMS || Retirement Planning || NPS Enrollment