Price, Financials, GMP, Should you Invest?

Archean Chemical IPO Subscription Day 1: Specialty chemical manufacturer Archean Chemical Industries Ltd’s initial public offering (IPO) opens today, November 9, 2022. The IPO will remain open for bids till November 11.

Archean Chemical IPO: Price Band

The price band has been fixed in the range of Rs 386 to Rs 407 per share for its initial share sale. At the upper end of the price band, the IPO is expected to fetch Rs 1,462 crore.

Archean Chemical IPO: Objective

Archean Chemical IPO consists of a fresh issue of equity shares aggregating up to Rs 805 crore and an offer-for-sale (OFS) of up to 1.61 crore shares by the promoter and investors, including the India Resurgence Fund, a joint venture between the Piramal Group and Bain Capital. The company plans to use the net proceeds of the fresh issue for the redemption of non-convertible debentures (NCDs) issued by it.

Archean Chemical IPO: GMP Today

As per market observers, Archean Chemical shares are commanding a premium (GMP) of Rs 60 in the grey market today.

The GMP of a stock can help serve as an indication of how the investor sentiment of an IPO may impact its performance. A strong GMP may indicate a higher likelihood of listing gains while a weak GMP may signal that shares of a company don’t list with any gains.

The shares of the company are expected to list on leading stock exchanges BSE and NSE on Monday, November 21, 2022.

Archean Chemical IPO: Should you Invest?

Brokerages and analysts remain mostly positive about the issue though warn to exercise caution due to its pricey valuation.

 “High entry barriers in the speciality marine chemicals industry bodes well for the company. In view of market leading position, established infrastructure, integrated production with cost efficiencies, consistent financial performance, high entry barriers for competitor, an experienced management team and attractive valuation, we recommend ‘SUBSCRIBE’ to the issue,” said Reliance Securities.

About Archean Chemical

Archean Chemical Industries is a leading manufacturer of specialty marine chemicals in India, and is focused on producing and exporting bromine, industrial salt, and sulphate of potash to customers around the world. It produces its products from its brine reserves in the Rann of Kutch, located on the coast of Gujarat, and manufactures products at its facility near Hajipir in Gujarat.

IIFL Securities, ICICI Securities and JM Financial are the book-running lead managers to the public issue. Link Intime India has been appointed as the registrar to the IPO.

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