Paragon Fine and Specialty Chemicals IPO: Company’s Issue to Launch on October 26, Price Band Rs 95-100
Paragon Fine and Specialty Chemicals IPO
Paragon Fine and Specialty Chemicals IPO: A Detailed Analysis
Paragon Fine and Specialty Chemicals is all set to make its debut in the stock market with an Initial Public Offering (IPO) scheduled for launch on October 26.
The company has carefully fixed the price band for its IPO at a range of Rs 95 to Rs 100 per share. This IPO will exclusively comprise a fresh issue of shares, with no Offer for Sale (OFS) component.
Paragon Fine and Specialty Chemicals, a company that specializes in the production of specialty, cosmetics, and pharma intermediates, is gearing up to raise a significant sum of Rs 51.66 crore through this public offering by issuing a total of 51.66 lakh shares.
Investors who are considering participating in this IPO should be aware of several key details. These include the lot size, the distribution of shares among different categories of investors, the bid structure, the timeline for the IPO process, and the utilization of the funds raised from the IPO.
Furthermore, understanding the company’s financial performance is crucial for potential investors, as it provides insights into the firm’s profitability and revenue growth.
Lastly, we’ll explore the listing date, which is a crucial milestone for those interested in trading the company’s shares in the secondary market.
Lot Size and Investor Categories
One of the important factors to consider for prospective investors is the lot size. The lot size determines the minimum number of shares an investor can bid for in this IPO. In the case of Paragon Fine and Specialty Chemicals, the lot size has been set to 1,200 shares.
This means that investors can bid for a minimum of 1,200 equity shares. Furthermore, any additional bidding must be done in multiples of 1,200 shares.
The distribution of shares among different categories of investors is another crucial aspect of this IPO. Of the net issue available to the public, which consists of 49.04 lakh shares, half of this allocation is reserved for qualified institutional buyers.
This allocation caters to the demand from institutional investors such as mutual funds, insurance companies, and foreign institutional investors. High net worth individuals, who fall under the category of non-institutional investors, are entitled to 15% of the shares.
This category includes individual investors with substantial financial means. The remaining 35% of the shares are designated for retail investors, which includes individual investors who may not meet the criteria for high net worth or institutional categories.
The allocation of shares to various investor categories is a critical factor in ensuring a fair and competitive process for the IPO. It aims to provide opportunities for different types of investors to participate in the offering.
IPO Timeline
The IPO process follows a specific timeline, with different stages leading up to the listing of the company’s shares on a stock exchange. In the case of Paragon Fine and Specialty Chemicals, the IPO will commence on October 26, with the offering open to investors.
It’s important to note that the anchor book of the IPO will open a day earlier, on October 25, which is a practice where institutional investors are given an opportunity to subscribe to the offering before the public offering.
The public offering is set to close on October 30, after which the company will no longer accept bids from investors.
It’s crucial for potential investors to adhere to these timelines to ensure they have the opportunity to participate in the IPO. Missing the deadline could result in missing out on this investment opportunity.
Utilization of Funds
Understanding how the funds raised through the IPO will be utilized is a vital aspect for investors. In the case of Paragon Fine and Specialty Chemicals, the company has outlined a clear plan for the utilization of the funds.
Out of the total amount raised from this IPO, Rs 1 crore will be used for civil construction related to the factory. This indicates the company’s intention to invest in infrastructure and expand its manufacturing capabilities.
A substantial portion of the funds, approximately Rs 7 crore, will be spent on the expansion of plant and machinery. This investment is indicative of the company’s growth strategy, suggesting its plans to enhance production capacity and capability.
Additionally, Rs 12.90 crore will be used to repay existing loans. This is a responsible financial decision that can reduce the company’s interest expenses and improve its overall financial health.
The remaining Rs 13 crore will be allocated for working capital and general corporate needs. Working capital is essential for day-to-day operations, and allocating funds for general corporate needs provides flexibility to address unforeseen expenses or seize opportunities for strategic growth.
It’s also worth noting that as of October 18, 2023, the company had total borrowings of Rs 13.44 crore. The allocation of a significant portion of the funds raised for debt repayment suggests a prudent approach to managing the company’s financial obligations.
Financial Performance
The financial performance of a company is a key consideration for investors evaluating an IPO. In the case of Paragon Fine and Specialty Chemicals, the company’s financial performance is notable.
In the fiscal year 2023, the company reported a net profit of Rs 9.89 crore. This figure reflects an impressive increase of 120.3 percent compared to the previous year.
Such significant growth in net profit is a positive indicator of the company’s financial health and profitability.
During the same fiscal year, the company’s operational revenue experienced notable growth as well. Operational revenue increased by 23.5 percent, reaching Rs 102.3 crore.
This revenue growth demonstrates the company’s ability to generate income and highlights its success in serving its target markets.
In the first quarter of fiscal year 2024, Paragon Fine and Specialty Chemicals continued its positive financial trajectory.
The company reported a net profit of Rs 3.62 crore, with revenues totaling Rs 28.8 crore. These figures indicate continued growth and profitability, which is an encouraging sign for prospective investors.
The company’s strong financial performance in recent years, characterized by substantial profit growth and revenue expansion, is a promising indicator for investors looking to participate in the IPO.
Listing Date
The listing date is a crucial milestone for investors in an IPO. It marks the day when the company’s shares are officially listed and traded on a stock exchange.
In the case of Paragon Fine and Specialty Chemicals, the company’s equity shares are expected to be listed and begin trading on NSE Emerge on October 7.
Investors who have successfully acquired shares in the IPO will be eager to see how the market values the company.
The listing date provides an opportunity for investors to buy, sell, or hold their shares, depending on their investment strategy and market conditions.
Company Overview
Paragon Fine and Specialty Chemicals is an Ahmedabad-based company with a focus on manufacturing products for a range of industries, including pharma, medical devices, electronics, paper, leather, plastics, and polymers.
The company’s core activities involve the production of specialty chemicals and intermediates that cater to the unique needs of these industries.
The company’s decision to go public through an IPO signifies its intention to raise capital to support its growth, expand its operations, and enhance its market presence.
It also offers investors the opportunity to become part of the company’s journey as it enters the public market.
Final Remarks
In conclusion, the Paragon Fine and Specialty Chemicals IPO presents an exciting opportunity for investors to participate in the growth and expansion of a company with a strong track record of financial performance.
The company’s focus on specialty chemicals and intermediates, as well as its plans for infrastructure development and expansion, make it an interesting prospect for investors looking to diversify their portfolios.
Investors should carefully consider the lot size, distribution of shares among different categories, bid structure, and the utilization of funds when evaluating this IPO.
Additionally, the company’s impressive financial performance in recent years and its growth prospects are key factors that may influence investment decisions.
With a listing date set for October 7, investors can anticipate the opportunity to trade Paragon Fine and Specialty Chemicals shares in the secondary market.
However, it’s essential to conduct thorough research and consult with financial advisors before making investment decisions to ensure they align with your financial goals and risk tolerance.
As with any investment, there are inherent risks associated with participating in an IPO, and investors should make informed decisions based on their individual circumstances and investment objectives.
