Key Points of JG Chemicals IPO Approval by SEBI:
- JG Chemicals, a Kolkata-based company and the largest zinc oxide manufacturer in India, has received approval from SEBI to raise funds through an IPO.
- The company submitted draft papers in January 2023 to raise funds through a fresh issue of Rs 202.50 crore, and an offer-for-sale of up to 5.70 million shares by its existing shareholders and promoters.
- The funds raised from the fresh issue will be used to invest in BDJ Oxides, set up a research and development centre, pay off a debt of Rs 45 crore, and cover the company’s long-term working capital requirements.
- JG Chemicals’ subsidiary will receive Rs 65 crore for its long-term working capital needs.
- Vision Projects and Finvest Pvt Ltd, Jayanti Commercial Ltd, Suresh Kumar Jhunjhunwala (HUF), and Anirudh Jhunjhunwalal (HUF) will sell up to 3.64 million shares, 1.4 lakh shares, 1.27 million shares, and 6.5 lakh shares, respectively, through the offer-for-sale (OFS).
- JG Chemicals is considering a private placement that could raise up to Rs 40 crore, a secondary sale by the selling shareholders of up to 2.85 million shares, or a combination of both.
- The issue is being managed by Centrum Capital, Keynote Financial Services Ltd, and Emkay Global Financial Services.
- The tire industry is JG Chemicals’ largest customer, and it also supplies to paint, footwear, and cosmetics manufacturers. In fiscal year 2022, the company generated a revenue of Rs 612.83 crore, up from Rs 435.30 crore a year earlier, and its net profit for the period increased to Rs 43.13 crore from Rs 28.80 crore the previous year, with the profit margin improving to 7.04 percent from 6.62 percent.
Details of JG Chemicals IPO Approval by SEBI:
Kolkata-based JG Chemicals Ltd, the largest manufacturer of zinc oxide in India, has received the green light from the Securities and Exchange Board of India (SEBI) to raise funds via an initial public offering (IPO).
The company submitted draft papers in January 2023 to the watchdog to generate funds through a fresh issue of Rs 202.50 crore, as well as an offer-for-sale of up to 5.70 million shares by existing shareholders and promoters.
JG Chemicals plans to invest the funds raised from the fresh issue into various areas, including its material arm BDJ Oxides, which had outstanding borrowings of Rs 54.65 crore as of December 2022.
The company also aims to set up a research and development centre with Rs 5.31 crore, pay off a debt of Rs 45 crore, and cover its long-term working capital requirements with Rs 35 crore. Moreover, the company’s subsidiary will receive Rs 65 crore for its long-term working capital needs.
Vision Projects and Finvest Pvt Ltd, Jayanti Commercial Ltd, Suresh Kumar Jhunjhunwala (HUF), and Anirudh Jhunjhunwalal (HUF) will sell up to 3.64 million shares, 1.4 lakh shares, 1.27 million shares, and 6.5 lakh shares, respectively, through the offer-for-sale (OFS). JG Chemicals is also considering a private placement that could raise up to Rs 40 crore, a secondary sale by the selling shareholders of up to 2.85 million shares, or a combination of both.
Centrum Capital, Keynote Financial Services Ltd, and Emkay Global Financial Services are managing the issue. The company’s three manufacturing facilities in Jangalpur, Belur, and Naidupeta have a combined installed capacity of 77,040 MTPA as of October 31, 2022.
The tire industry is JG Chemicals’ biggest consumer, and the company also supplies to paint, footwear, and cosmetics manufacturers. In fiscal year 2022, the company generated a revenue of Rs 612.83 crore, up from Rs 435.30 crore a year earlier. Its net profit for the period increased to Rs 43.13 crore from Rs 28.80 crore the previous year, with the profit margin improving to 7.04 percent from 6.62 percent.
About JG Chemicals:
JG Chemicals, established in 1975, is a member of the prestigious BDJ Group. The Jhunjhunwala family, who have been active in trade and industry for over 90 years, promote the BDJ Group and have played a significant role in the growth of several industries in India. JGC specializes in producing zinc oxide.
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