Rossari Biotech makes strong debut; lists at 58 per cent premium over issue price

Speciality Chemicals manufacturer, Rossari Biotech Limited, made a strong debut on the stock exchanges on Thursday, as the stock listed at Rs 670 on BSE, with a 57.5 per cent premium to its issue price of Rs 425 apiece. The initial share-sale is the first stock market listing in FY21, thereby ending the four-month of inactivity in the IPO market.

The initial public offering (IPO) of the company which was managed by Axis Capital and ICICI Securities was oversubscribed by 79.37 times after opening for sale between July 13, 2020, and July 15, 2020. It had a price band of Rs 423-Rs 425 per share. The offering was meant to raise capital of around Rs 496 crore for the company.

In a press release, the company said that the money raised from the fresh issue and pre-IPO placement will be used to repay its borrowings of Rs 65 crore and further, fund the working capital requirement of the company amounting to Rs 50 crore as well as for other general corporate purposes.

For FY20, the company’s revenue stood at Rs 603.91 crore with a net profit of Rs 65.25 crore. On a CAGR basis, the company has managed to clock an impressive growth rate of 41.65 per cent in its revenue and 60.27 per cent in net profit.

Rossari Biotech is a speciality chemicals manufacturing firm focussing on home and personal care, performance chemicals, textile speciality chemicals, and animal health as well as nutrition products.

At 11.15 am on Thursday, the stock of Rossari Biotech was trading at Rs 702.70, higher by 4.88 per cent or Rs 32.70 per share on BSE, against 0.38 per cent gain in the benchmark index.