The Rs 625 crore issue was subscribed 83.29 times, with the quota for qualified institutional investors seeing bids for 67.45 times the quota limit and the retail quota 11.84 times the limit. The HNI quota saw 271.15 times subscription.
Angel Broking is expecting a good listing for the company.
Heranba’s revenues have grown at a CAGR of 13 per cent during FY18-FY20 whereas PAT expanded at a CAGR of 44 per cent during the same period. The company has recorded average return on equity (RoE) and return on capital employed (RoCE) of 31.3 per cent and 56 per cent, respectively, over the last three years.
The company has also been a reduction in debt on its books and trades at a reasonable valuation multiple of 25 times P/E compared with its peers.
The company, however, faces a high risk due to a spike in raw material prices, which form a whopping 70 per cent of its expenses. The company also faces high competition risk from peers such as Rallis India, Bharat Rasayan and Sumitomo Chemical. Despite these risks, Heranba continues to capture a dominant position with sound fundamentals and diversification capabilities, analysts said.
Investors, who bid for the IPO, can check the subscription status on the online portal of Bigshare Services, the registrar to the issue. The registrar is a Sebi-registered entity, qualified to act as such and which electronically processes all applications, and carries out the allotment process as per the prospectus.
On Bigshare Services’ web portal, one needs to select the IPO whose data will be populated only when the basis of allotment is declared. You would need to provide PAN ID or application ID or client ID and DPID (depository participant identification) to fetch the information.
The registrar is responsible for complying with the timelines for updating the electronic credit of shares to successful applicants, dispatch, and uploading of refunds, and attending to all investor-related queries after the issue is completed.
Another way of checking the IPO allotment status is via stock exchanges. To be able to do so on BSE, one can click here. https://www.bseindia.com/investors/appli_check.aspx
Heranba is one of the leading domestic producers of pyrethroids with a 19.6 per cent market share. Pyrethroids accounted for 68 per cent of the company’s FY20 revenues.
ICICIdirect said the company is benefitting from being an integrated pyrethroids manufacturer with a strong product pipeline, geographical expansion coupled with favourable macro factors are likely to drive growth.
“Apart from this, it has one of the strongest return ratios in Industry and a healthy balance sheet,” the brokerage said in its IPO note.
The company has presence in a wide range of products across the entire value chain of synthetic pyrethroids with a market share of 20 per cent supported by a distribution network of more than 9,600 dealers spread across 16 states and 1 union territory. Exports business contributed to half of the total revenues in FY20. That included exporting technicals and formulations to more than 60 countries. The company 371 technical registrations obtained till November 2020.
Antique Stock Broking said the company’s management intends to focus on enhancing and streamlining production capacities and operations; entering the highly regulated markets of USA and Europe; developing new products at its R&D facility at Unit III and enhancing formulations & technicals business in international markets.
“It is in the entire value chain of synthetic pyrethroids that provides flexibility to shift between products depending on the demand-supply and pricing dynamics. The company also has a strong pending product pipeline in pyrethroids including formulations filed by partners in domestic, export markets. Apart from this, more than half of the global demand for Pyrethroids comes from China. Hence, due to shutdown of chemical plants in China amid pollution, higher volumes of Pyrethroids are expected to be exported out of India,” it said.