Ami Organics IPO off to strong start. Subscription, allocation date and more details

The IPO of Ami Organics opened today and the issue closes on September 3. Ahead of the IPO, the specialty chemicals maker had mopped up ₹171 crores from anchor investors. Ami Organics allocated 28,01,485 equity shares to 20 anchor investors, including SBI  Healthcare Fund, SBI Mutual Fund, Kuber India Fund, and UTI Healthcare Fund, at the upper band of Rs. 610 per share. Ami Organics has set a price band of ₹603-610 a share for the ₹570 crore IPO.

Ami Organics IPO off to strong start. Subscription, allocation date and more details
Ami Organics IPO: Many brokerages have recommended subscribe to the issue

The IPO of Ami Organics opened today and the issue closes on September 3. Ahead of the IPO, the specialty chemicals maker had mopped up 171 crores from anchor investors. Ami Organics allocated 28,01,485 equity shares to 20 anchor investors, including SBI  Healthcare Fund, SBI Mutual Fund, Kuber India Fund, and UTI Healthcare Fund, at the upper band of Rs. 610 per share. Ami Organics has set a price band of 603-610 a share for the 570 crore IPO.

As of 1:40 am, Ami Organics IPO was subscribed 1.38 times.

Lot size and allotment date of Ami Organics IPO

The lot size of Ami Organics is 24 equity shares and bids can be made in multiples of 24 equity shares thereafter. 35% of the issue size has been reserved for retail investors, 50% for qualified institutional investors, and the remaining 15 percent for non-institutional investors.

Link Intime India Private Ltd is the registrar of the IPO and according to brokerages, share allotment in Ami Organics IPO is likely to be finalized on September 8 and the listing could happen on September 14.

Ami Organics share GMP
According to grey market observers, Ami Organics shares are quoting at a premium of 162 in the grey market.

The IPO comprises of fresh issue of equity shares aggregating up to Rs. 200 crores and an offer of sales of up to 6,059,600 equity shares by promoter selling shareholders. Also ahead of the IPO, Ami Organics had undertaken a pre-IPO placement of equity shares aggregating to 100 crores.

Post-IPO, the holdings of promoters and promoter groups will fall to 41.1% from 47.2%.

Proceeds from the fresh issue will be used towards repayment of certain debt and funding working capital requirements.

Ami Organics Limited is a manufacturer of specialty chemicals with varied end usage and is one of the major manufacturers of pharma intermediaries for certain key APIs.

Financials of Ami Organics

Ami Organics has more than half of its revenue come from global markets. Exports accounted for 51.5% of its revenues in the fiscal year ending March 2021, according to brokerages. In FY21, the company had reported revenues of 340 crores and a net profit of 54 crores.

The company has recently completed the acquisition of two additional manufacturing facilities operated by GOL which has added preservatives and other specialty chemicals to its existing product portfolio.

What brokerages say on Ami Organics IPO

Many brokerages have recommended subscribe to Ami Organics IPO. "The company has shown consistent financial performance with sales growth at CAGR of 19.5% and restated profit after tax growth at CAGR of 52.3% between the Fiscals 2019 and 2021. The financials for 2020-21 doesn’t include revenue from the acquisition of the two plants. We are positive about the long-term prospects of the Company. Hence, we recommend a "Subscribe" rating to this IPO," domestic brokerage Anand Rathi said.

Ami Organics issue is “available at the upper end of the IPO price band at 41.2x its FY21 earnings, with a market cap of Rs. 22,227 million. Further on the FY21 earnings basis, the company is trading below the industry average of 48.91x. Looking at the P/B ratio on the upper price band, book value and P/B are Rs. 53 and 11.51x respectively along with a RoNW of 32.35%," Anand Rathi added.

The IPO of Vijaya Diagnostic also opened for subscription today.