Nova Agritech IPO to open on January 22; Sets IPO price at Rs 39-41 per share

16 Jan 2024 , 10:02 AM

Founded in May 2007 in Hyderabad, Nova Agritech Limited specializes in manufacturing agricultural products designed to enhance crop growth, with a primary focus on soil health, plant nutrition, and crop protection. Leveraging advanced technology, the company produces environmentally friendly and nutrient-rich products. Nova Agritech actively collaborates with farmers, closely understanding their specific needs and developing tailored solutions that align with their requirements.

The company is currently gearing up for its Initial Public Offering (IPO), and key details are outlined below:

IPO Details:

• Dates:
  • Subscription opens on January 22
  • Subscription closes on January 24
  • Anchor book opens on January 19
• Price Band: Rs 39-41 per share
• Lead Managers: Keynote Financial Services Ltd and Bajaj Capital
• IPO Registrar: Bigshare Services Pvt Ltd

Issue Composition:

• Fresh issue of shares worth Rs 112 crore
• Offer-for-sale (OFS) of 77.58 lakh equity shares by Nutalapati Venkatasubbarao, holding 11.97 percent in the company
• Total IPO Size: The company aims to raise approximately Rs 143.81 crore at the upper band.

Objects of the Issue: The Net Proceeds from the Fresh Offer, after deducting the allocated offer expenses, will be utilized for:

1. Investment in Subsidiary: Allocation to Nova Agri Sciences Private Limited for establishing a new formulation plant.
2. Capital Expenditure: Funding the expansion of the current formulation plant within the Company.
3. Working Capital Requirements (Company): Allocation for meeting the working capital needs of the company.
4. Investment in Subsidiary’s Working Capital: Investment in Nova Agri Sciences Private Limited to support its working capital requirements.
5. General Corporate Purposes: Utilization for general corporate purposes to enhance overall business operations.

Company Valuation: Rs 267.33 crore, with Nova Agritech holding an 84.27 percent stake.

Financial Performance (FY23):

• Consolidated net profit: Rs 20.5 crore (49.7% YoY growth)
• Revenue: Rs 210.6 crore (13.4% YoY growth)
• EBITDA: Rs 38.7 crore (39.3% YoY growth), with a margin expansion to 18.4%

Financial Performance (Six months ending September FY24):

• Consolidated net profit: Rs 10.4 crore
• Revenue: Rs 103.22 crore
• Telangana contributes significantly, accounting for 76% of business in H1 FY24

Product Registrations: The company holds 720 product registrations across various categories.

IPO Allocation:

• Qualified Institutional Buyers (QIBs): 50%
• Non-Institutional Investors: 15%
• Retail Investors: 35%

Basis of Allotment: Finalized by January 25

Listing Date: Trading is expected to commence on January 30.