Fertilizer maker Paradeep Phosphates to launch ₹1,500 cr IPO on 17 May

Zuari Agro Chemicals group company Paradeep Phosphates Ltd, where the government holds a 19.55% stake, is launching its initial public offering (IPO) on 17 May, the company said in a stock exchange filing.

The company has fixed a price band of Rs39-42 per share. The IPO will close on 19 May.

The IPO comprises a fresh issue of shares of up to ₹1,004 crore, while existing shareholders of the company, including the promoter entity Zuari Maroc Phosphates Pvt. Ltd and the government of India, will sell 118 million shares through the IPO. The government is offloading its entire 19.55% stake through the IPO.

At the upper end of the price band, the secondary share sale by the promoter and government will be worth ₹497.7 crore.

The proceeds from the fresh issue of shares will be used by the company to part-finance the acquisition of a Goa facility and repayment of certain borrowings.

Investment banks Axis Capital, ICICI Securities, JM Financial and SBI Capital Markets are advising the company on its IPO.

Paradeep Phosphates is the second largest private sector manufacturer of non-urea fertilizers in the country and the second largest private sector manufacturer in terms of Di-Ammonium Phosphate (DAP) volume sales for the nine months ended 31 December, 2021, as per the company’s prospectus filed with Sebi. The company is primarily engaged in manufacturing, trading, distribution and sales of a variety of complex fertilizers such as DAP, three grades of Nitrogen-Phosphorus-Potassium, Zypmite, Phospho-gypsum and Hydroflorosilicic Acid. It is also engaged in the trading, distribution and sales of Muriate of Potash, Ammonia, Speciality Plant Nutrients (SPN) and City compost. Its fertilizers are marketed under brand names ‘Jai Kisaan – Navratna’ and ‘Navratna’.

For the nine months ending 31 December 2021, the company reported a revenue of ₹5,973.6 crore, while the revenue for fiscal 2021 stood at ₹5,183.9 crore.

The company reported a profit of ₹362.7 crore in the nine month period ending 31 December 2021, while profit for fiscal 2021 stood at ₹223.2 crore.