Advanced Enzyme Technologies (AET) is the second largest enzyme company in India  and amongst the Top 15 global enzyme companies with a market share of 0.9%. The company is engaged in research & development, manufacturing and marketing of 400+ proprietary products developed from 60 indigenous enzymes. Angel Broking has recommended 'Neutral' to IPO of Advanced Enzyme Technologies.

Commenting on the investment rationale, the stock broker said, ''AET is the second largest player in the Indian enzyme industry. Given the Management experience in the industry and the Indian cost advantage, we believe that the company can post robust growth going forward. AET has reported a strong CAGR of 23.9% in net profit in-spite of the 14.4% CAGR in sales during FY2012-16, helped by high entry barriers, which also enables the company to get high margins.

However, we believe that the company's scale of operations is small in comparison to its global peers and its business is dependent on few products. At Rs 880-896/share, which is the lower and upper end of the offer price band, the company is available at ~6.1-6.2x it's FY2017E P/BV. We believe the price fully discounts all the positives. Thus, we recommend a neutral view on the issue.''

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