IPO investments continue to attract attention from both seasoned and new investors. With several upcoming IPOs scheduled, opportunities abound for those seeking to diversify their portfolios. One such offering is the Shiv Texchem Limited IPO.
In this blog, we will explore key details like the issue date, price band, and lot size of this IPO. Whether you are a retail investor or looking for bigger opportunities, understanding these basic elements is crucial before making investment decisions. Read more here to learn about the specifics of Shiv Texchem Limited's offering and how it might fit into your investment strategy.
Shiv Texchem IPO is a fresh issue valued at ₹101.35 crores, with a total offering of 61.06 lakh shares. This IPO opens for subscription on October 8, 2024, and closes on October 10, 2024. The finalisation of allotments is expected on October 11, 2024. Investors can look forward to the Shiv Texchem Limited IPO's SME on the BSE platform, with the tentative listing date set for October 15, 2024. For those interested in IPO investments and upcoming IPOs, this could be a significant opportunity to explore.
The Shiv Texchem IPO price band has been set between ₹158 and ₹166 per share. Retail investors can apply for a minimum lot of 800 shares, requiring an investment of ₹132,800. High Net Worth Investors (HNIs) will need to apply for at least 2 lots (1,600 shares), amounting to ₹265,600. Vivro Financial Services Private Limited is managing this IPO as the book-running lead manager, with Link Intime India Private Ltd serving as the registrar. Rikhav Securities is the market maker for the IPO. This opportunity is a notable option for those seeking IPO investments.
| Shiv Texchem Limited IPO open date | October 8, 2024 (Tuesday) |
| Shiv Texchem Limited IPO close date | October 10, 2024 (Thursday) |
| Allotment allocation | October 11, 2024 (Friday) |
| Refund initiation | October 14, 2024 (Monday) |
| Crediting shares to DEMAT | October 14, 2024 (Monday) |
| Date of listing | October 15, 2024 (Tuesday) |
| Maximum time for UPI mandate confirmation | October 10, 2024, by 5 PM |
Founded in 2005, Shiv Texchem Limited specialises in importing and distributing hydrocarbon-based secondary and tertiary chemicals and essential raw materials for various industries. The company offers a diverse range of chemicals, including Acetyls, Alcohols, Aromatics, Nitriles, Monomers, Glycols, Phenolics, Ketones, and Isocyanates. These products serve as crucial feedstocks for sectors like paints, coatings, printing inks, agrochemicals, speciality polymers, and pharmaceuticals.
Shiv Texchem sources these chemicals from reputable international manufacturers and suppliers across countries like China, Taiwan, South Korea, Kuwait, Qatar, the USA, the Netherlands, Belgium, and Italy. Their customer portfolio includes notable names such as Apcotex Industries Limited, Hemani Industries Limited, and Gujarat Fluorochemicals Limited.
Over the past three financial years, the company has significantly expanded its offerings, growing its product range from 21 in FY2022 to 39 in FY2024. Correspondingly, its customer base has increased from over 400 in FY2022 to more than 650 in FY2024. As of March 31, 2024, Shiv Texchem employs 50 permanent staff members, highlighting its growth and commitment to providing timely supplies in the hydrocarbon chemical sector.
Shiv Texchem Limited reported a significant revenue growth of 37% and an impressive 88% increase in profit after tax (PAT) for the financial year ending on March 31, 2024, in comparison to the previous year. The market capitalisation for the Shiv Texchem IPO stands at ₹384.66 crore, reflecting strong investor interest. Additionally, the Shic Texchem Limited IPO GMP is currently ₹40, indicating positive sentiment among potential investors looking to explore opportunities in IPO investments.
| Period ended | 30th June 2024 | 31st March 2024 | 31st March 2023 |
| Total assets | 85,483.43 | 79,868.05 | 60,234.98 |
| Revenue | 56,707.83 | 1,53,668.79 | 1,11,866.98 |
| Profit after tax | 1,005.89 | 3,011.3 | 1,602.72 |
| Net worth | 20,293.58 | 19,287.69 | 12,276.39 |
| Reserves and surplus | 20,080.25 | 19,074.36 | 12,116.39 |
| Borrowing | 27,085.63 | 29,665.25 | 32,914.39 |
*Amount in ₹ Lakh
Before investing in the IPO, take a look at the strengths that this company possesses.
Shiv Texchem Limited stands out with its differentiated business model that offers comprehensive and integrated retail and supply chain solutions. This approach enhances operational efficiency and supports sustained growth.
The company boasts a well-diversified product portfolio, catering to a broad customer base while maintaining extensive relationships with suppliers. This diversity mitigates risks and maximises opportunities across various sectors.
Shiv Texchem has built long-standing, active relationships with its customers, ensuring trust and loyalty. These connections contribute to steady demand and a competitive edge in the market.
The management team at Shiv Texchem is experienced, dedicated, and highly qualified, possessing extensive knowledge of the hydrocarbon-based chemical industry. Their expertise is crucial in navigating market dynamics and driving growth.
Shiv Texchem focuses on providing storage solutions alongside a commitment to consistent financial performance. This strategy not only supports operational needs but also instills confidence among investors.
Shiv Texchem Limited IPO: Weaknesses
Understanding the potential challenges associated with an investment is crucial for informed decision-making. Below are some of the key weaknesses of the Shiv Texchem IPO that investors should consider before participating.
There are ongoing legal disputes involving the company, some of its promoters, and directors. Any adverse outcomes in these cases could negatively impact the company's operations and financial health.
As of March 31, 2024, Shiv Texchem's total borrowings stood at ₹296.65 crore, which includes unsecured loans amounting to ₹39.91 crore from related parties. The potential for these loans to be recalled at any time poses a risk, as the inability to service or repay these borrowings may adversely affect the company's operations.
Despite the expansion of its product range in recent years, Shiv Texchem's top 10 products continue to dominate its revenue streams. In FY22, FY23, and FY24, these products accounted for ₹826.36 crore (96.24%) and ₹1,13,734.76 crore (74.10%) of total revenue, indicating a heavy reliance on a limited product portfolio.
Shiv Texchem operates under a high-volume, low-margin business model. This structure necessitates generating substantial sales volumes to offset lower profit margins per unit. Any inability to achieve these volumes could significantly impact the company's financial performance.
The company has experienced negative cash flows in the past. Any recurrence of this situation in the future could further jeopardise the company's financial stability and operational viability.
The Shiv Texchem IPO presents an intriguing opportunity for investors interested in IPO investments. With a price band of ₹158 to ₹166 and a fresh issue of ₹101.35 crores, this offering aims to enhance its market presence. The company's well-diversified product portfolio and solid revenue growth highlight its potential in the hydrocarbon-based chemical industry. However, investors should be cautious of the challenges related to high borrowings and reliance on a limited number of products for revenue. Overall, Shiv Texchem offers a unique proposition for those considering upcoming IPOs in this sector.
Investing in the Shiv Texchem IPO could be a strategic move, particularly for those looking to diversify their portfolios. The company's growth potential, coupled with its established market presence, makes it a noteworthy consideration. Nevertheless, awareness of potential risks is essential before making any investment decision.
The Shiv Texchem IPO will open for subscription on October 8, 2024, and close on October 10, 2024.
The price band for the Shiv Texchem IPO is set between ₹158 and ₹166 per share, making it accessible to various investors.
The Shiv Texchem IPO is expected to be listed on the BSE SME, with the tentative listing date set for October 15, 2024.
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