To begin with, Rossari Biotech is not a biotech company but more of a specialty chemicals company. The IPO is open from July 13 to July 15. The price band has been set at Rs.423-425 per share. IPO investors can bid for the shares in multiples of 35 shares. The 496 crore issue will have a 10% new issue component and the balance 90% will be offer-for-sale or OFS.

The funds will be used for repayment of debt and for working capital purposes and the actual trading in the stock post listing will commence on July 23. Fundamentally, the business model is organized across (a) home & personal care, (b) specialty textile chemicals and (c) animal health and nutrition products. HUL, IFB, Arvind, Vinati are key customers.

For the fiscal year 2020, Rossari Biotech reported total sales revenues of Rs.604 crore and earnings before interest, depreciation and amortization or EBITDA of Rs.105 crore while net profits stood at Rs.65 crore. The first two segments above accounted for 90% of the sales. Revenues have growth at CAGR of 42% while EBITDA has grown at CAGR of 57%.

What investors need to be aware of RossariBiotech is that it has raised Rs.149 crore from anchor investors. More importantly, the anchor investors include marquee names like Abu Dhabi Investment Authority, HDFC MF, Axis MF, ICICI Prudential MF, SBI MF, Sundaram MF, HDFC Life and Goldman Sachs India.