Shivam Chemicals
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 23 Apr 2024 – 25 Apr 2024
- Listing date
- 30 Apr 2024
- Face value
- ₹10 per share
- Issue price
- ₹44 per share
- Lot size
- 3,000 shares
- Issue type
- Fixed Price issue
- Total issue size
- ₹20.18 Cr
- Market cap at offer price
- ₹74.74 Cr
- Promoter holding
- 99.99% → 73.00% pre-issue → post-issue
- ISIN
- INE0SGR01013
- Registrar
- Cameo Corporate Services Ltd.
- Lead managers
- Aryaman Financial Services Ltd.
- Registered office
- Office No.108, 1st Floor, Hubtown Solaris, Off N.S.Phadke Marg, Saiwadi, Andheri (East), Maharashtra
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Market maker | 2,31,000 | — | — |
Application size
Minimum 3,000 shares per lot, in multiples, at ₹44
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 3,000 | ₹1,32,000 |
| S-HNI (min) | 2 | 6,000 | ₹2,64,000 |
| S-HNI (max) | 7 | 21,000 | ₹9,24,000 |
| B-HNI (min) | 8 | 24,000 | ₹10,56,000 |
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.
Valuation and performance
Valuation at offer price
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 2.88 | 0.56 |
| P/E (×) | 15.28 | 78.57 |
| Price to book (×) | 3.90 | — |
| Market cap | — | ₹74.74 Cr |
Key performance indicators
- Return on net worth
- 5.06%
- ROCE
- 6.19%
- Debt / equity
- 1.17
- PAT margin
- 0.66%
- NAV per share
- ₹11.29
- Price to book
- 3.90
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Shivam Chemicals
Shivam Chemicals Limited was incorporated as Sun Organosys Private Limited on October 12, 2010, and later renamed to Shivam Chemicals Limited in November 2023. The company was engaged in trading of animal feed supplements and chemical products till FY 2022-23, with a focus on distributing products such as Poultry Feed Supplement (MBM), Di-Calcium Phosphate (Feed Grade), Magnesium Oxide, and Limestone Powder. With rich experience and a well-established marketing network across India, the company has supplied over 2.50 lakh metric tons of various products with a cumulative value exceeding INR 7,500 million. In FY 2023-24, the company diversified into manufacturing through its wholly owned subsidiary Shivam Chemicals and Minerals Private Limited, located at Dahej, Gujarat, with a manufacturing capacity of 60,000 MT engaged in manufacturing Hydrated Lime (Calcium Hydroxide). The company maintains average monthly sales volume of 2,650 metric tons and operates on a purchase order basis without long-term customer contracts.
Company Analysis
from RHPShivam Chemicals Limited is a manufacturer of Hydrated Lime and distributor of animal feed supplements and chemical products including poultry feed supplement, di-calcium phosphate, and limestone powder, operating in the animal feed and chemicals industries.
Shivam Chemicals Limited was incorporated as Sun Organosys Private Limited on October 12, 2010, and later renamed to Shivam Chemicals Limited in November 2023. The company was engaged in trading of animal feed supplements and chemical products till FY 2022-23, with a focus on distributing products such as Poultry Feed Supplement (MBM), Di-Calcium Phosphate (Feed Grade), Magnesium Oxide, and Limestone Powder. With rich experience and a well-established marketing network across India, the company has supplied over 2.50 lakh metric tons of various products with a cumulative value exceeding INR 7,500 million. In FY 2023-24, the company diversified into manufacturing through its wholly owned subsidiary Shivam Chemicals and Minerals Private Limited, located at Dahej, Gujarat, with a manufacturing capacity of 60,000 MT engaged in manufacturing Hydrated Lime (Calcium Hydroxide). The company maintains average monthly sales volume of 2,650 metric tons and operates on a purchase order basis without long-term customer contracts.
Objects of the Issue
- Funding Working Capital Requirements in Our Company ₹ 705.00 lakhs p.20
- Investment in Subsidiary Co. M/s Shivam Chemicals & Minerals Pvt. Ltd. for financing the augmentation of its working capital capabilities ₹ 562.00 lakhs p.20
- General Corporate Purpose ₹ 501.28 lakhs p.20
- Funding Working capital requirements in our Company ₹705.00 lakhs p.63
- Investment in Subsidiary Co. M/s Shivam Chemicals & Minerals Pvt Ltd. for financing the augmentation of its working capital capabilities ₹562.00 lakhs p.63
- General Corporate Purpose ₹501.28 lakhs p.63
- Funding capital expenditure for manufacturing operations and expansion
- Issue expenses p.180
Issue Structure
- Total Issue
- ₹ 2,018.28 lakhs (45,87,000 Equity Shares of face value ₹ 10 each at price of ₹ 44 per share)
- Fresh Issue
- ₹ 2,018.28 lakhs (45,87,000 Equity Shares of face value ₹ 10 each at price of ₹ 44 per share)
- Offer for Sale
- Not Applicable
- Price Band
- ₹ 44 per Equity Share (Fixed Price Issue)
- Lot Size
- 3,000 Equity Shares (market lot) and in multiples of 3,000 thereafter with minimum allotment of 3,000 Equity Shares
- Face Value
- ₹ 10 per Equity Share
Business Model
The company earns revenue through two streams: (1) trading and distribution of animal feed nutrients and chemical products including Poultry Feed Supplement (MBM), Di-Calcium Phosphate (Feed Grade), Magnesium Oxide, Limestone Powder, and Soya De-oiled Cake, and (2) manufacturing of Hydrated Lime through its subsidiary company. The company operates on a purchase order (PO) basis, procuring products from suppliers and selling them to customers without maintaining significant inventory or long-term contracts.
Business Segments
SWOT Analysis
- • Established distribution network across India with significant market presence(p.20)
- • Substantial volume track record with cumulative supplies exceeding 2.50 lakh metric tons(p.20)
- • Strong financial significance with cumulative value of supplies exceeding INR 7,500 million(p.20)
- • Consistent market presence with average monthly sales volume of 2,650 metric tons(p.20)
- • Manufacturing capacity of 60,000 MT through wholly-owned subsidiary at Dahej, Gujarat(p.20)
- • Promoter with 35 years of experience in chemical industry(p.32)
- • Experienced management team with deep industry expertise(p.87)
- • In-house manufacturing through wholly-owned subsidiary(p.87)
- • Proprietary Italian technology providing competitive advantage(p.87)
- • Improved input ratio through advanced technology(p.87)
- • Cost-efficient logistics using bulker trucks(p.88)
- • Established distribution network across India(p.90)
- • Strong track record with major customers(p.103)
- • Established distribution network with diversified customer base(p.149)
- • Manufacturing capacity of 60,000 MT through wholly-owned subsidiary(p.149)
- • Consistent monthly sales volume and strong market presence(p.149)
- • Diversified product portfolio across feed supplements and chemicals(p.149)
- • 100% reliance on trading activities until FY 2022-23; manufacturing is nascent (started May 2023)(p.25)
- • Subsidiary has limited manufacturing experience and recently commenced operations(p.25)
- • Manufacturing operations are capital-intensive with significant fixed asset investments(p.25)
- • Low current capacity utilization due to first year of operation(p.25)
- • Concentrated customer base with top 5 customers accounting for 41.40% of revenue(p.26)
- • High dependency on few suppliers (top 5 suppliers accounted for 62.02% in FY 2023)(p.33)
- • Significant reliance on few products with top 3 products accounting for 95.56% of revenue(p.25)
- • Very low profit margins with average PAT of 1.89% over 3 years(p.30)
- • Substantial outstanding debt of ₹1,638.20 lakhs including ₹667.42 lakhs unsecured loans from promoters(p.31)
- • Promoters have provided personal guarantees up to ₹995 lakhs for subsidiary's loan facilities(p.31)
- • Negative operating cash flows in recent periods (December 2023: -₹39.71 lakhs; FY 2022: -₹300.06 lakhs)(p.27)
- • Registered office and guest house/branch office are on lease with renewal uncertainties(p.34)
- • Company logo is not registered; only trademark is registered in director's personal name(p.35)
- • Promoters' average cost of acquisition at ₹0.32 per share is significantly below issue price of ₹44(p.24)
- • Group company name (Superior Lime Private Limited) faces potential forced change due to RoC order(p.30)
- • High dependence on few customers(p.93)
- • Recently commenced commercial manufacturing operations(p.66)
- • Limited capacity utilization in early operations(p.87)
- • Small workforce with limited depth(p.86)
- • Significant leverage with elevated net debt to EBITDA(p.73)
- • Heavy dependence on top 10 customers for majority of revenue(p.150)
- • Significant dependence on top 10 suppliers(p.157)
- • High leverage ratio with debt-to-equity of 1.17:1(p.148)
- • Decline in profitability from FY 2022 to FY 2023(p.154)
- • Significant losses in initial operations due to manufacturing setup(p.156)
- • Deployment of IPO proceeds for working capital strengthening (₹705 lakhs allocated)(p.20)
- • Subsidiary manufacturing capacity expansion opportunity (₹562 lakhs allocated for augmentation)(p.20)
- • Scale up manufacturing operations as initial year capacity utilization grows(p.25)
- • Diversification into manufacturing of value-added chemical products (hydrated lime, quick lime)(p.20)
- • Growing animal feed market in India(p.82)
- • Expanding global animal feed market(p.81)
- • Growing limestone market globally and in India(p.84)
- • Strong Indian economic growth trajectory(p.81)
- • Government support for animal feed sector(p.83)
- • Expansion into untapped geographic markets(p.90)
- • Diversification of product portfolio(p.89)
- • Expansion into manufacturing with recent subsidiary operations(p.149)
- • Growing demand across animal feed and chemical product segments(p.149)
- • Potential to leverage manufacturing capacity utilization(p.149)
- • Decline in demand for animal feed products or manufacturing discontinuation(p.24)
- • Outbreak of poultry and livestock diseases could restrict product supply(p.39)
- • Highly competitive animal feed and chemical industry with pricing pressures(p.33)
- • Rising transportation costs may not be fully passable to customers(p.29)
- • Dependence on third-party transportation providers for product delivery(p.29)
- • Economic downturns and inflation could reduce customer demand and increase costs(p.40)
- • Changes in government regulations and policies affecting chemical and animal feed industries(p.39)
- • Interest rate and banking policy changes could adversely affect profitability and liquidity(p.40)
- • India's sovereign debt downgrade could constrain company's ability to raise financing(p.37)
- • Lack of long-term customer contracts creates revenue predictability risk(p.33)
- • Natural calamities, industrial accidents, or chemical exposure hazards at manufacturing facility(p.36)
- • COVID-19 or other severe communicable disease outbreak could disrupt operations(p.37)
- • Delays or defaults in customer payments could reduce profits and working capital(p.35)
- • Equipment breakdowns or power interruptions at manufacturing facility(p.35)
- • Fluctuating raw material prices(p.82)
- • Diversion of feed raw materials to human consumption(p.82)
- • Competition from unorganized sector(p.93)
- • Global economic slowdown(p.79)
- • Operational risks in manufacturing(p.95)
- • Price and supply volatility of feed materials(p.82)
- • Significant exposure to economic cycles and commodity price volatility(p.150)
- • Intense competition from organized and unorganized market players(p.150)
- • Risk of customer inventory fluctuations affecting demand(p.150)
- • Exposure to supply chain disruptions and input cost volatility(p.150)
- • Seasonal nature of business operations(p.157)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Sanjiv Girdharlal Vasant | Promoter | 69.99% | 51.10% |
| Soham Sanjiv Vasant | Promoter | 7.50% | 5.47% |
| Shivam Sanjiv Vasant | Promoter | 7.50% | 5.47% |
| Rajshree Girdharlal Vasant | Promoter Group | 7.50% | 5.47% |
| Mayuri Sanjiv Vasant | Promoter Group | 7.50% | 5.47% |
| Sanjiv Girdharlal Vasant | Promoter | 69.99% | 51.10% |
| Soham Sanjiv Vasant | Promoter | 7.50% | 5.47% |
| Shivam Sanjiv Vasant | Promoter | 7.50% | 5.47% |
| Rajshree Girdharlal Vasant | Promoter Group | 7.50% | 5.47% |
| Mayuri Sanjiv Vasant | Promoter Group | 7.50% | 5.47% |
| Sanjiv Girdharlal Vasant | Promoter | 70.00% | — |
| Soham Sanjiv Vasant | Promoter | 7.50% | — |
| Shivam Sanjiv Vasant | Promoter | 7.50% | — |
Leadership
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.