Specialty chemicals manufacturer Rossari Biotech enjoyed a bumper listing today on the stock exchanges as the stock closed with 75% gains from its issue price. Rossari Biotech shares got listed on the stock exchanges at a price of Rs 670 per share, up 57% from its issue price of Rs 425 per share, and ended the day’s trading session at a price of Rs 742 per share, a premium of 75% from the issue price. The share price surged to hit a high of Rs 804 per share. Rossari Biotech’s initial public offering (IPO) was subscribed almost 80 times. It was the first successful IPO to enter the stock markets after SBI Cards and Payment Services in March this year.
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The Rs 496 crore Rossari biotech IPO received bids for 64,87,33,645 shares against the total issue size of 81,73,530 shares on offer. Qualified institutional buyers (QIBs) subscribed to the issue 85 times, while non-institutional investors subscribed 239 times, and retail investors subscribed their portion over 7 times. Post the issue, promoters will have a 72.69% stake in the company while public shareholding will jump to 27.31%.
Analysts said that the company has a good global presence with exposure to over 17 countries. “Rossari has expanded to local as well as global markets to mark its presence in the competitive landscape. Robust management and sound corporate governance policy will drive growth going forward and this is already visible in its current return ratios,” Nirali Shah, Senior Research Analyst, Samco Securities said earlier this month.
Rossari Biotech IPO was the first to enter equity markets after Antony Waste Handling Cell, which had to withdraw its Rs 206 crore IPO in March as the market began to tank. Rossari Biotech, prior to the IPO, managed to raise Rs 148 crore from anchor investors, including top fund houses like SBI Mutual Fund, ICICI Mutual fund, and HDFC Mutual fund. Rossari Biotech has a strong fundamental appeal with the top line, EBITDA and net profit CAGR of 32%, 63%, and 67% respectively from the financial year 2017 to 2020. The specialty chemical manufacturer informed that its total debt has gone from Rs 27.7 crore in the financial year 2018 to Rs 77.2 crore in the last fiscal year.