Stallion India Fluorochemicals IPO Opens Tomorrow – Check Details

Stallion India Fluorochemicals IPO

Stallion India Fluorochemicals IPO: Complete Guide to the Issue Opening on January 16, 2025

The much-anticipated Stallion India Fluorochemicals IPO is set to open for subscription on January 16, 2025, offering investors an opportunity to invest in the company’s public issue.

This comes as the company seeks to raise funds for its working capital and expansion plans, making it one of the noteworthy IPOs in the market this year.

Stallion India Fluorochemicals, a Mumbai-based company that specializes in refrigerants, industrial gases, and related products, aims to raise up to Rs 199.45 crore through the IPO.

With a price band set between Rs 85 and Rs 90 per share, the issue will remain open for subscription until January 20, 2025. The company plans to list its shares on the BSE and NSE, marking an important milestone in its journey.

Investors will need to weigh their options carefully, especially as the stock market has been facing significant challenges in recent months.

Key Highlights of Stallion India Fluorochemicals IPO

Stallion India Fluorochemicals intends to raise capital by issuing 1.79 crore fresh equity shares, which are worth Rs 160.73 crore.

Additionally, the IPO includes an Offer for Sale (OFS) of 43.02 lakh equity shares, valued at Rs 38.72 crore, by the company’s promoter, Shahzad Sheriyar Rustomji.

Rustomji, who owns 94.6% of the company’s equity, will be selling a portion of his holding in the public issue.

The remaining 5.37% stake in the company is held by Geetu Yadav, a public shareholder. This offer is particularly significant as it marks the first major step for Stallion India Fluorochemicals to go public.

The IPO will open for anchor investors on January 15, 2025—a day before the public subscription opens—and the share allotment is expected to take place on January 21, 2025.

Investors should be aware that the shares are expected to be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on January 23, 2025.

IPO Structure and Investor Categories

The IPO is divided into various categories, with 50% of the offer size reserved for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and 35% for retail investors.

This structure ensures that the company attracts a diversified investor base, from large institutional investors to individual retail participants.

Retail investors will have the opportunity to subscribe to the IPO at a lower entry point, given the current price band range of Rs 85-90 per share.

The sole book-running lead manager for the public issue is Sarathi Capital Advisors, a well-regarded financial advisory firm, which will assist in overseeing the IPO process and ensuring the smooth execution of the subscription and listing procedures.

Purpose of the IPO Funds

The funds raised through the IPO are earmarked for several key areas:

• Rs 95 crore will be used to meet the company’s incremental working capital requirements, helping it strengthen its operational capacity and expand its reach.
• Rs 50.3 crore will be allocated for capital expenditure. This includes setting up specialized facilities for Semi-Conductor and Specialty Gas Debulking and Blending at its Khalapur facility, as well as setting up a Refrigerant Debulking and Blending Facility at Mambattu in Andhra Pradesh.
• The remaining funds will be used for general corporate purposes, providing flexibility in meeting other operational needs and strategic investments as they arise.

Business Overview of Stallion India Fluorochemicals

Stallion India Fluorochemicals, founded in September 2002, operates in the field of refrigerants and industrial gases, focusing on the debunking, blending, and processing of gases.

In addition, the company sells pre-filled cans and small cylinders of refrigerants and industrial gases to a variety of industrial sectors, including refrigeration, automotive, and manufacturing.

The company faces stiff competition from other well-established players in the market, such as Navin Fluorine International, SRF, and Gujarat Fluorochemicals.

Despite the intense competition, Stallion India Fluorochemicals has built a niche in the market, focusing on quality products and reliable customer service.

The company’s growth prospects are bolstered by its strategic plans to expand production facilities and increase market share.

The IPO funds are expected to fuel these expansion initiatives, particularly in the areas of semi-conductor and refrigerant gas processing.

Financial Performance of Stallion India Fluorochemicals

The financial health of Stallion India Fluorochemicals has seen both growth and challenges in recent years.

For the fiscal year 2023-24 (FY24), the company reported a 51.6% growth in its net profit, which increased to Rs 14.8 crore, compared to Rs 9.8 crore in FY23.

Despite the significant growth in FY24, the company had faced a 53.8% decline in net profit in FY23, compared to the previous fiscal year.

This shows the volatility in its earnings but also highlights the potential for rebound, especially as the company moves forward with its expansion plans.

In terms of revenue, Stallion India Fluorochemicals saw a 3.4% growth in FY24, with total revenue increasing to Rs 233.2 crore, compared to Rs 225.5 crore in FY23.

In FY22, the company’s revenue was recorded at Rs 185.9 crore, indicating a consistent upward trajectory in its sales.

Despite its recent profit fluctuations, the company’s steady revenue growth, coupled with its plans for further capital investment and facility expansion, positions it well for future profitability.

Competitive Landscape

The company will be entering the market at a time when the sector is experiencing rapid growth but also facing fierce competition.

Key competitors in the refrigerants and industrial gases market include Navin Fluorine International, SRF, and Gujarat Fluorochemicals, all of which are already well-established in the market.

However, Stallion India Fluorochemicals has a unique opportunity to capture market share with its planned infrastructure upgrades and its competitive pricing strategy.

Final Remarks

The Stallion India Fluorochemicals IPO presents an intriguing opportunity for investors to participate in the growth of a company with strong potential in the refrigerants and industrial gases industry.

With a well-defined plan for utilizing the funds raised through the IPO, a solid business model, and a strategic focus on expanding its manufacturing capacity, Stallion India Fluorochemicals is poised to make a significant impact on the market.

However, given the challenges in the stock market and the competitive landscape, investors should carefully assess the company’s financials, growth prospects, and the potential risks before making any investment decisions.

The IPO opens on January 16, 2025, and closes on January 20, 2025, with share allotment on January 21 and listing on January 23.

Whether you’re a retail investor or an institutional player, this is a great opportunity to invest in a growing company in the industrial gases sector.