Citichem India is coming up with an IPO offering 18,00,000 fresh equity shares of the company, aggregating to INR 12.60 crores. The company intends to use the funds raised to acquire property, purchase vehicles to improve its transportation, and for general corporate purposes.

Citichem India Ltd IPO – Important Details

Read more about Citichem India Ltd IPO GMP

Citichem India Ltd IPO – Company Profile

Citichem India Limited is mainly engaged in the buying, procuring, and supplying of organic and inorganic chemicals, bulk drugs, and food chemicals to the pharmaceutical industry. The traded speciality chemicals and intermediates have a wide application in aluminium, steel, textiles, paper, dairy, paints, dyes & intermediates, soap making, pharma, food, and adhesive Industry. 

With the combined experience of its Promoters for over 25 years with their expertise in sourcing, negotiating, procuring, and supplying organic and inorganic chemicals to the pharmaceutical industry, and with the existing long-standing clientele, the company aims to expand further and diversify its procurement sources and achieve growth by multiplying the supply chain of the chemicals to the said industry. 

Citichem India Ltd IPO – Fundamental Analysis

Citichem India Limited shows strong profitability growth in FY2024; the declining revenue, weak Q1 FY2025 performance, and shrinking asset base raise concerns about future sustainability.

Revenue Growth: 

Revenue has declined by 6.4% from FY2023 to FY2024, indicating potential stagnation or decreased demand. The Q1 FY2025 revenue is notably low, which may indicate seasonality or slower business activity.

Profitability: 

The sharp increase in PAT for FY2024 reflects improved profitability despite declining revenue. However, Q1 FY2025 PAT suggests a significant slowdown in profitability compared to the previous year.

Return on Net Worth (RoNW): 

The significant improvement in RONW from FY2023 to FY2024 reflects better utilisation of equity to generate returns. 

Earnings Per Share (EPS): 

The sharp increase in EPS for FY2024 is positive, driven by better profitability.

Net Asset Value (NAV) per Equity Share: 

NAV growth reflects the company’s ability to increase shareholder value. The consistent increase in NAV per share is a positive indicator of financial stability.

Asset and Liability Management: 

The decline in total assets indicates a potential scaling down of operations. The Q1 FY2025 figure shows minimal improvement, suggesting limited asset expansion. Liabilities have decreased significantly, reflecting improved financial management. This reduction enhances the company’s overall stability.

Citichem India Ltd IPO Financial Information

Citichem India Ltd IPO Peer Comparison

Citichem India Limited, with ₹1,961 lakh revenue, offers a P/E of 31.30, 15.42% RoNW, and ₹14.50 NAV. Vinyl Chemicals leads with ₹59,701 lakh revenue and strong metrics, while Shankar Lal Rampal reports ₹28,773 lakh revenue but lower profitability at 6.59% RoNW.

Citichem India Ltd IPO Objective

Citichem India Limited plans to allocate INR 3.60 crores for acquiring property for warehousing to meet growing demand, INR 4.69 crores for purchasing transportation vehicles and accessories, and funds for general corporate purposes.

1. Acquire property: To cater to the growing demand for the products from existing customers and to meet the requirements of new customers, the company is planning to acquire property for warehousing purposes for ease of storage and supply of the products. The company plans to utilise INR 3.60 crores for the said purpose. 

2. Purchase of Transportation Vehicles and Accessories: For the smooth functioning of the business, the company intends to purchase transportation vehicles and accessories. The company plans to utilise INR 4.69 crores towards the purchase. 

3. General corporate purposes:  The company will deploy funds for general corporate purposes and target synergies benefiting from management expertise, R&D, manufacturing, and distribution network.

Citichem India Ltd IPO Risks And Challenges

Citichem India Limited’s IPO faces pending litigation with potential adverse outcomes impacting reputation, business, and financial performance. Dependency on five key customers generating 95% of revenue poses a significant risk to operations.

1. Pending litigation: Various cases are pending against or by the company, directors, promoters, or group company. Any adverse outcome in such proceedings may hurt the reputation, business, financial condition, results of operations, and cash flows.

2. Dependency on a few customers: The company is dependent on its top 5 customers, which generates almost 95% of its revenue.  The loss of, or a significant reduction in purchases by such customers, could adversely affect the financial performance.

Citichem India Ltd IPO –  Industry & Market Potential

India’s chemical sector, which was estimated to be worth US$ 220 billion in 2022, is anticipated to grow to US$ 300 billion by 2025 and US$ 1 trillion by 2040. The demand for chemicals is expected to expand by 9% per annum by 2025. The chemical industry is expected to contribute US$ 383 billion to India’s GDP by 2030. 

India has traditionally been a world leader in generics and biosimilars and a major Indian vaccine manufacturer, contributing more than 50% of the global vaccine supply. Chemicals and petrochemicals demand in India is expected to nearly triple and reach US$ 1 trillion by 2040. 

The Indian chemical industry is expected to further grow with a CAGR of 11-12% by 2027, increasing India’s share in the global speciality chemicals market to 4% from 3%.

Citichem India Ltd IPO – Type of Offer

Citichem India is launching an IPO of 18,00,000 fresh equity shares worth INR 12.60 crores. The funds will be utilised to acquire property, purchase transportation vehicles, and meet general corporate purposes.

Citichem India Ltd IPO Offer Size

The offer size is INR 12.60 crores, comprising 18,00,000 fresh equity shares. Citichem India plans to utilise the proceeds to acquire property, purchase transportation vehicles, and fund general corporate purposes.

Citichem India Ltd IPO Allotment Structure

Citichem India Limited’s IPO allotment structure includes categories for retail individual investors (RII), non-RIIs with application values exceeding INR 2 lakhs, and a reservation for market makers for 92,000 shares.

Retail Individual Investors (RII): The application value does not exceed INR 2 lakhs. These individual investors apply for shares with a total value of less than Rs. 2 lakhs.

Other than retail individual investors: Such applications where the value exceeds INR 2 lakhs.

Market Maker Reservation: 92,000 shares are reserved for market makers. 

How to apply for a Citichem India IPO through Alice Blue?

To apply for the Citichem India IPO through Alice Blue, you would typically follow these steps:

Open a Demat and Trading Account: If you don’t have one already, you must open a Demat and trading account with Alice Blue.

1. Check for IPO Details: Once your account is active, you can check for the Citichem India IPO details in the IPO section of the Alice Blue platform.
2. Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.
3. Submit the Application: Confirm all your details and submit your application.

 You can apply for Citichem India IPO at Alice Blue in just a few clicks!

Check Allotment Status: After the allotment process, you can check the allotment status to see if you have received any shares.

Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How to Check Citichem India IPO Allotment Status on Alice Blue?

Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:

1. Log in to your Alice Blue Account: You can do this through the Alice Blue website or their trading app.
2. Navigate to the Portfolio or IPO Section: This might differ based on the layout of Alice Blue’s platform, but generally, you can find the status of your IPO application under the ‘Portfolio’ or ‘IPO’ section.
3. Find the IPO Allotment Status: Look for a sub-section called ‘IPO Allotment Status’ or something similar. This is where you can see the status of the IPOs you have applied for.
4. Select the Citichem India IPO: If you have applied for multiple IPOs, there might be a dropdown menu or a list where you can select the IPO you are interested in. Select the Citichem India IPO.
5. Check the Status: The status of your application should be displayed here. If the shares have been allocated to you, it would be mentioned here.

If you face any issues, we request you reach out to our customer support team at Alice Blue for detailed assistance. 

Apart from Alice Blue, there are other ways to check the allotment status of the Citichem India IPO:

●     Registrar’s Website: Visit the website of KFIN Technologies Limited, the registrar of the Citichem India IPO. On the homepage, look for the ‘IPO Allotment Status’ option. You must enter your PAN and application number or Demat account number to check your allotment status. Click on the ‘Submit’ button to view your IPO allotment status.

●   BSE SME: You can also check the allotment status on the official websites of the Bombay Stock Exchange (BSE) SME (Small Medium Enterprise) Platform. You would need your application number and PAN to check the status.

 Please note that the allotment status will only be available after the allotment process has been completed, a few days after the IPO window closes.

Citichem India Ltd IPO Offer Registrar

The registrar for the Citichem India Limited IPO is KFIN Technologies Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.

 Contact information for the registrar:

KFIN Technologies Limited 

Selenium, Tower-B, Plot 31& 32,

 Gachibowli Financial District 

Nanakramguda, Hyderabad – 500032, 

Telangana, India

Telephone: +91-40-6716-2222

Email: [email protected]

Website: www.kfintech.com

Citichem India Ltd IPO FAQs