Live news , top stories, corporate news, company news, sector news, economy news, results analysis news, ceo interviews, fund manager interview, advisor interview, market news, bazaar talk, hot stocks news, ipo news, commodities news, mutual fund news, insurance news, news wire
14 August, 2022 11:16 IST
High valuations, weak market: ARL hammered on listing day
Source: IRIS | 24 Mar, 2021, 02.48PM
Rating: NAN / 5 stars.
Comments  |  Post Comment

 Anupam Rasayan (ARL), engaged in manufacturing of custom synthesis (CSM) and specialty chemicals in India, saw a lacklustre listing today on the exchanges - down 6% against its issue price of Rs 555/share.

The Rs 7,600 million IPO of ARL was subscribed 44 times earlier this month but given market volatility, its grey market premium had fallen substantially to just Rs 100/share.

Despite some GMP, the stock made a weak debut at Rs 520/share. ARL has a diversified product portfolio with life science related specialty chemicals (agrochemicals, personal care and pharmaceuticals) contributing 94% of revenue, while other specialty chemicals (specialty pigment and dyes, and polymer additives) formed 6% of revenue.

Commenting on the ARL IPO, Hemang Jani, Head Equity Strategy, Broking & Distribution, Motilal Oswal Financial Services, "With major capex behind, the sweating of assets would help ARL capitalize on the growth opportunities of CSM market (expected to grow at 12% CAGR over next 5 years). The funds raised will be utilized to repay debt of Rs 5.6 billion, post which the company would become debt free. However, the valuations were little on a higher side and given the current market sentiment, this led to a weak listing.

Further there are too many IPOs hitting the market at the same time which is resulting in quick rotation of money. Speciality chemical segment is also getting over-crowded; thus, companies with over-valuation are not well supported at a time of weak market cues."

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.

 



 Post Comment
Name Email
Comment
Security Code type    into this box
Related Articles
Home  |   Shares  |   F&O  |   Mutual Funds  |   Loans  |   Insurance  |   News Centre
Wealth Tracker  |   Newsletters  |   Tax Corner  |   NRI Centre  |   Advertise
© All rights reserved. IRIS Business Services Limited
A Disclaimer