Archean Chemical
Mainboard₹1,462 Cr issue
+10.32%
Listing gain over issue price
Issue size
₹1,462 Cr
1 lot at cut-off
₹14,652
Lot size
36shares
Open
09 Nov 2022
Close
11 Nov 2022
Allotment
16 Nov 2022
Listing
21 Nov 2022
Listing performance
Issue price
₹407
Listed at
₹449
Listing-day close
₹458.15
Latest price
₹478.45
Close on 23 Oct 2026
Listing gain
+10.32%
Return since issue
+17.56%
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 09 Nov 2022 – 11 Nov 2022
- Listing date
- 21 Nov 2022
- Face value
- ₹2 per share
- Issue price
- ₹407 per share
- Lot size
- 36 shares
- Total issue size
- ₹1,462 Cr
- Market cap at offer price
- ₹5,666 Cr
- Promoter holding
- 65.58% → 55.23% pre-issue → post-issue
- ISIN
- INE128X01021
- Registrar
- MUFG Intime India Pvt.Ltd.
- Lead managers
- IIFL Capital Services Ltd.
- Registered office
- No.2, North Crescent Road, T Nagar, Tamil Nadu
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Anchor investor · within QIB | 1,61,67,991 | — | — |
| Market maker | 0 | — | — |
Application size
Minimum 36 shares per lot, in multiples, at ₹407
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 36 | ₹14,652 |
| Retail (max) | 13 | 468 | ₹1,90,476 |
| S-HNI (min) | 14 | 504 | ₹2,05,128 |
| S-HNI (max) | 68 | 2,448 | ₹9,96,336 |
| B-HNI (min) | 69 | 2,484 | ₹10,10,988 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Anchor investors
Institutional allocation placed a day before the issue opens, carved out of the QIB portion and locked in after listing.
Shares allocated
1,61,67,991
Anchor portion
₹658 Cr
at ₹407 per share
Valuation and performance
Valuation at offer price
₹407 per share
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 18.26 | — |
| P/E (×) | 22.29 | — |
| Market cap | — | ₹5,666 Cr |
Key performance indicators
Latest reported period
- Return on net worth
- 72.24%
- ROCE
- 34.62%
- Debt / equity
- 3.53
- PAT margin
- 16.68%
- EBITDA margin
- 42.42%
- NAV per share
- ₹25.28
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Archean Chemical
Archean Chemical Industries Limited was originally formed as a partnership firm in November 2003 and converted to a private limited company in 2009, subsequently becoming a public limited company in December 2021. The company operates a single manufacturing facility at Hajipir in Gujarat, where it produces bromine, industrial salt, and sulphate of potash from its brine reserves located in the Rann of Kutch on the coast of Gujarat. According to the Company Commissioned F&S Report, the company is a leading specialty marine chemical manufacturer in India and focused on producing and exporting these products to customers around the world. The company generates revenue primarily through the export of these three products to markets in Asia, Europe, and other regions.
Company Analysis
from RHPArchean Chemical Industries is a leading specialty marine chemical manufacturer in India focused on producing and exporting bromine, industrial salt, and sulphate of potash from brine reserves in the Rann of Kutch, Gujarat.
Archean Chemical Industries Limited was originally formed as a partnership firm in November 2003 and converted to a private limited company in 2009, subsequently becoming a public limited company in December 2021. The company operates a single manufacturing facility at Hajipir in Gujarat, where it produces bromine, industrial salt, and sulphate of potash from its brine reserves located in the Rann of Kutch on the coast of Gujarat. According to the Company Commissioned F&S Report, the company is a leading specialty marine chemical manufacturer in India and focused on producing and exporting these products to customers around the world. The company generates revenue primarily through the export of these three products to markets in Asia, Europe, and other regions.
specialty chemicalsmarine chemicalsbromine productionindustrial saltpotash production
Objects of the Issue
- Redemption or earlier redemption, in part or full, of NCDs issued by our Company ₹6,440.00 million p.15
- General corporate purposes p.15
- Redemption or earlier redemption, in part or full, of NCDs issued by our Company ₹6,440.00 million p.96
- General corporate purposes p.96
- Redemption or earlier redemption, in part or full, of NCDs issued by our Company ₹6,440.00 million p.98
- General corporate purposes p.97
Issue Structure
- Total Issue
- Up to [●] Equity Shares aggregating up to ₹ [●] million
- Fresh Issue
- Up to [●] Equity Shares aggregating up to ₹8,050.00 million
- Offer for Sale
- Up to 16,150,000 Equity Shares aggregating up to ₹ [●] million
- Price Band
- [●] per Equity Share (Floor Price) to [●] per Equity Share (Cap Price)
- Lot Size
- [●] Equity Shares and in multiples of [●] Equity Shares
- Face Value
- ₹2 each
Business Model
The company manufactures specialty marine chemicals (bromine, industrial salt, and sulphate of potash) from brine reserves and sells them to customers globally. In the three months ended June 30, 2022, approximately 66.74% of revenue came from exports. The company derives revenue from fixed sales contracts with agreed pricing and volumes (approximately 12 months for bromine customers, 24 months for industrial salt customers) and purchase orders from customers. Cost of materials consumed represents approximately 3-4% of gross revenue, with the majority of expenses consisting of packing, despatching and freight costs (approximately 40-50% of total expenses).
Business Segments
Production and export of bromine, a specialty marine chemical used in various industrial applications
Production and export of industrial salt for various industrial applications
Production and export of sulphate of potash, derived from kainite type mixed salt
Manufacturing and sale of industrial salt
Manufacturing and sale of bromine
Manufacturing and sale of sulphate of potash
Recovered from soluble salts found in seawater, salt lakes, inland seas and brine wells. Used as key initial level materials with applications in pharmaceuticals, agrochemicals, water treatment, flame retardant, additives, oil & gas and energy storage batteries. Market is expected to grow at a CAGR of 5.8% between CY2020 and CY2025.
An important raw material used in chemical industry for production of sodium carbonate (soda ash), caustic soda, hydrochloric acid, chlorine, bleaching powders, chlorates, sodium sulphate (salt cake) and sodium metal. Also used in oil & gas drilling, de-icing, water treatment, food processing and pharmaceuticals. Global demand expected to grow at CAGR of 2.8% between CY2020 and CY2025.
A high-end, specialty fertilizer for chlorine-sensitive crops and also has medical uses to reduce the plasma concentration of potassium when hypokalemia occurs. Company is the only manufacturer of sulphate of potash from natural sea brine in India. Global demand expected to grow at CAGR of 6.0% between CY2021 and CY2025.
Production of liquid bromine with specifications of <60 ppm of chlorine and < 30 ppm of moisture using the steaming-out process, which is less energy intensive than the blowing-out process.
Production of industrial salt through solar evaporation process, which is the principal material in chlorine and caustic soda production (chloralkali). Serves end-uses in vinyl, phosgene, chlormethanes, water treatment, synthesis HCI, bleach, and other chemical materials.
Production of sulphate of potash (potassium sulphate), a high-end specialty fertilizer for chlorine-sensitive crops. Used in agriculture to provide potassium and sulphur in soluble forms, stimulating growth of strong stems and providing disease resistance. Primary application in agrochemicals industry.
Manufacture and supply of marine chemicals including salt, bromine, and sulphate of potash
Bromine is a highly corrosive, hazardous and toxic chemical used as key initial level materials with applications in pharmaceuticals, agrochemicals, water treatment, flame retardant, additives, oil & gas and energy storage batteries.
Industrial salt is an important raw material used in chemical industry for production of sodium carbonate (soda ash), caustic soda, hydrochloric acid, chlorine, bleaching powders, chlorates, sodium sulphate (salt cake) and sodium metal.
Sulphate of potash is used as a fertilizer and also has medical uses. The company is the only manufacturer of sulphate of potash from natural sea brine in India.
SWOT Analysis
Strengths
- • Established manufacturing capacity with ISO 9001:2015 certification(p.44)
- • Strong export revenue base across 13 countries(p.48)
- • Insurance coverage exceeds asset valuation significantly(p.45)
- • Improved credit ratings and operational financial performance(p.47)
- • Leading market position as largest exporter of bromine and industrial salt in India(p.152)
- • Among the lowest-cost global producers of bromine and industrial salt(p.157)
- • Established integrated infrastructure with proximity to ports(p.156)
- • Superior cost position in industrial salt production(p.157)
- • Only manufacturer of sulphate of potash from natural sea brine in India(p.154)
- • High entry barriers protecting market position through technical complexity and regulatory hurdles(p.156)
- • One of the world's largest salt works at single location(p.156)
- • Strong environmental and safety commitment with third-party monitoring(p.158)
- • Experienced management team with deep industry expertise(p.160)
- • Long-standing customer relationships providing stability(p.163)
- • Contracted sales with fixed terms providing revenue certainty(p.164)
- • Strategic location with access to large salt reserves and ports(p.165)
- • Low production costs due to geographic advantage(p.166)
- • Market leadership in merchant bromine sales in India(p.161)
- • Strategic investments from experienced financial partners(p.160)
- • Leading exporter of bromine and industrial salt in India(p.283)
- • Command leadership position in Indian bromine merchant sales(p.284)
- • Only manufacturer of sulphate of potash from natural sea brine in India(p.284)
- • Integrated production facility with access to captive port infrastructure(p.284)
- • Specialized expertise in handling corrosive bromine chemical(p.284)
- • Significant improvement in profitability and EBITDA margins(p.302)
Weaknesses
- • History of losses and negative equity position(p.42)
- • Significant pending litigation and tax disputes(p.42)
- • High finance costs relative to EBITDA(p.42)
- • Promoter pledge obligations and related party conflicts(p.51)
- • Over 400 contract workers with no formal engagement policy(p.49)
- • Heavy dependence on utility supplies from third parties(p.48)
- • Significant dependence on volatile commodity prices and foreign exchange fluctuations(p.23)
- • Low capacity utilization in sulphate of potash at 1.91% in FY2022(p.156)
- • High debt burden from NCD financing at 17% interest rate(p.97)
- • Historical losses and financial distress requiring restructuring(p.155)
- • Limited geographic diversification with over-reliance on China for industrial salt exports(p.144)
- • High customer concentration risk(p.163)
- • Significant concentration of salt sales with single customer(p.163)
- • Very low capacity utilization for sulphate of potash(p.167)
- • High freight and logistics costs(p.168)
- • No patent protection for intellectual property(p.169)
- • Limited sales and marketing team(p.168)
- • High finance costs burden(p.221)
- • Significant deferred tax liability position(p.254)
- • High leverage with large debt obligations(p.250)
- • Substantial expected credit loss provisions on receivables(p.245)
- • Heavy reliance on single major customer for significant revenue portion(p.287)
- • High concentration in top 20 customers representing majority of revenue(p.287)
- • Reliance on concentrated product portfolio of three main products(p.287)
- • High leverage with significant non-convertible debenture debt burden(p.285)
- • Significant financial costs as percentage of revenue(p.285)
- • Past debt restructuring event and historical defaults(p.288)
- • Disputed tax liabilities with limited remedies(p.328)
- • High financial leverage with restrictive covenants limiting business flexibility(p.330)
- • Significant secured debenture obligations with first charge over material assets(p.332)
- • Restrictive covenants limit capital allocation and business expansion decisions(p.333)
- • Outstanding litigation with CSIR/CSMCRI regarding royalty obligations(p.337)
- • Lease expiration risk on primary manufacturing facility(p.328)
- • High interest rates on debenture obligations impacting profitability(p.331)
Opportunities
- • Expansion of industrial salt and bromine manufacturing capacities(p.46)
- • Increasing global demand for specialty marine chemicals(p.48)
- • Growing global bromine market with 5.8% CAGR through 2025(p.154)
- • Expansion into bromine derivative products (flame retardants, clear brine fluids, catalysts)(p.154)
- • High-growth bromine derivatives market with expected 10.5% CAGR for green chemicals(p.124)
- • Shift of manufacturing from China to India creating regional sourcing opportunities(p.124)
- • Growing Indian specialty chemicals market at 12% CAGR through 2025(p.125)
- • Strong global demand for brominated organic intermediates with 10.5-11.5% growth expected(p.139)
- • Industrial salt market growth driven by multiple applications including chlor-alkali production(p.154)
- • Expansion into downstream bromine derivatives with growing market demand(p.160)
- • Global bromine market growth at 5.8% CAGR(p.161)
- • Brominated flame retardants market growth at 6% CAGR(p.160)
- • Expansion of bromine production capacity(p.161)
- • Industrial salt production capacity expansion(p.161)
- • Geographic expansion with focus on Asia and Europe(p.161)
- • Growing wallet share with existing long-term customers(p.161)
- • Growing global bromine market demand with CAGR of 5.8%(p.284)
- • Increasing demand for bromine-based flame retardants and specialty products(p.284)
- • Expansion into bromine derivative performance products market(p.284)
- • Global industrial salt market growth expected at CAGR of 2.8%(p.284)
- • Growing sulphate of potash demand at CAGR of 6.0%(p.284)
- • Planned bromine capacity expansion and new derivative facility(p.285)
Threats
- • Significant slowdown in Indian economic growth(p.52)
- • Global economic conditions affecting export-dependent business(p.53)
- • Trade barriers and tariffs on exported products(p.48)
- • Inflation impacting operating costs and profitability(p.55)
- • Risks from natural calamities and health epidemics(p.54)
- • Foreign exchange fluctuations affecting export revenues(p.59)
- • Evolving regulatory environment and compliance uncertainty(p.54)
- • India's sovereign credit rating downgrade risks(p.56)
- • Volatile raw material costs and commodity price fluctuations affecting profitability(p.23)
- • Dependence on limited customer base with concentration risk(p.154)
- • Exposure to monsoon and weather conditions affecting production(p.157)
- • Stringent environmental regulations and compliance requirements(p.156)
- • Global competition from lower-cost producers in Israel, Jordan, and United States(p.157)
- • Declining Chinese bromine production creating export competition as China imports more(p.134)
- • Regulatory risk from stringent product approval standards and changing regulations(p.156)
- • Significant international competition from established players(p.169)
- • Need for continuous cost reduction to remain competitive(p.169)
- • High industry entry barriers but requiring process innovation(p.169)
- • Dependence on hazardous chemical handling with environmental risks(p.169)
- • Dependence on raw material supply from domestic suppliers(p.168)
- • Export-oriented business exposed to forex volatility(p.164)
- • Lease renewal uncertainty for primary manufacturing facility(p.240)
- • Exposure to foreign currency exchange risk(p.266)
- • Disputed statutory tax liabilities under appeal(p.274)
- • Global competition from larger foreign manufacturers with greater resources(p.289)
- • Risk of competitors consolidating and integrating operations(p.289)
- • Exposure to foreign exchange rate fluctuations(p.288)
- • Reliance on export-dependent business with logistics vulnerabilities(p.286)
- • Ongoing COVID-19 pandemic impact and potential future shutdowns(p.286)
- • Events of default could trigger acceleration of debt and loss of management control(p.334)
- • Debt service reserve account failure could constitute event of default(p.333)
- • Cross-default provisions across multiple borrowing arrangements(p.335)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Chemikas Speciality LLP | Promoter Selling Shareholder | 38.21% | — |
| Ranjit Pendurthi | Promoter | 25.81% | — |
| Ravi Pendurthi | Promoter | 1.56% | — |
| Chemikas Speciality LLP | Promoter | 38.21% | — |
| Ranjit Pendurthi | Promoter | 25.81% | — |
| Ravi Pendurthi | Promoter | 1.56% | — |
| Pendurti Brahmanandam | Promoter | — | — |
| Ravi Pendurthi | Promoter | — | — |
| Ranjit Pendurthi | Promoter | — | — |
| Sojitz Corporation | Shareholder/Investor | — | — |
| Chemikas Speciality LLP | Corporate Promoter | 38.21% | — |
| Ravi Pendurthi | Individual Promoter | — | — |
| Ranjit Pendurthi | Individual Promoter | — | — |
| Chemikas Speciality LLP (formerly known as Goodearth Fertilisers Company LLP) | Promoter Group | 40.96% | — |
| P. Ranjit | Promoter | 27.67% | — |
| India Resurgence Fund Scheme - II | Promoter Group | 12.19% | — |
| Piramal Natural Resources Private Ltd. | Promoter Group | 7.46% | — |
| India Resurgence Fund Scheme - I | Promoter Group | 7.46% | — |
| P. Ravi | Promoter | 1.67% | — |
| Chemikas Speciality LLP | Promoter | — | — |
| Ranjit Pendurthi | Promoter | — | — |
| Ravi Pendurthi | Promoter | — | — |
Leadership
Ranjit Pendurthi · Managing Director
Gnanavelu Arunmozhi · Company Secretary and Compliance Officer
Raghunathan Rajagopalan · CFO
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.
Archean Chemical IPO FAQs
What is the lot size of Archean Chemical IPO?
The minimum lot size of Archean Chemical IPO is 36 shares. One lot costs ₹14,652 at the cut-off price.
When does Archean Chemical IPO open and close?
Archean Chemical IPO opened for subscription on 09 Nov 2022 and closed on 11 Nov 2022.
What is the listing date of Archean Chemical IPO?
Archean Chemical IPO listed on 21 Nov 2022.