JG Chemicals debuts with 5% discount to IPO price

The issue, which closed on March 7, received decent response from investors with an overall subscription of nearly 28 times at close.

The retail portion of the issue was subscribed 17.4 times, while the non-institutional category (NII) category was subscribed a whopping 46.3 times. The quota for qualified institutional buyers (QIBs) was booked 32 times.

At the upper price end, At the upper, the issue was valued at an EV/EBITDA of 12.3x based on FY23 earnings.

Net proceeds from the fresh issue are proposed to be utilised towards investment in its material subsidiary, repayment of debt, funding capex, working capital requirements as well as other general corporate purposes.

Also Read:

JG Chemicals is India’s largest zinc oxide manufacturer in terms of production and revenue for zinc oxide manufacturing through French process, which is the dominant production technology for producing zinc oxide and has been adopted by all the major producers in Americas, Europe and Asia.

It sells over 80 grades of zinc oxide and are among the top ten manufacturers of zinc oxides globally. The firm also supplies to leading paints manufacturers, footwear players, and cosmetics players in the country.

Its subsidiary, BDJ Oxides, holds the coveted IATF certification, making it a preferred supplier for tyre manufacturers. The company caters to 200 domestic customers and 50 global customers spanning across more than 10 countries.

For the nine months ended December 2023, the company's total income stood at Rs 491 crore and profit after tax was at Rs 18.5 crore. In FY23, total income jumped 27% year-on-year to Rs 794 crore, while profit increased 32% to Rs 56.8 crore.

, , and acted as the book-running lead managers to the issue.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)