IPO Update: Neogen Chemicals IPO subscribed 2 times

The IPO of speciality chemicals company Neogen Chemicals is receiving good response from the investor community. Despite volatitity in the equity market, the company's IPO was subscribed more than 2.09 times on Day 2.

Neogen Chemicals is a leading manufacturers of bromine-based and lithium-based speciality chemicals. The company was founded by H T Kanani and is among the largest manufacturers of bromine derivatives, lithium salts and Grignard compounds in India. Its products includes organo bromide compounds, speciality chloro compounds, advanced intermediates, Grignard reagents, lithium salts and inorganic bromine compounds. Neogen has two manufacturing plants one located at Navi Mumbai and other at Karkhadi, Vadodara. Apart from catering to the domestic market, the company exports to 27 countries across the world The company exports majorly to the US, the UK, Spain, France, Germany, Italy and Japan.

The company's Rs. 132 crore Initial Public Offering (IPO) comprises a fresh issue of around Rs. 70 crore and an offer-for-sale (OFS) from selling shareholders of up to 29,00,000 equity shares, which includes a anchor portion of 18,46,715 equity shares. The price band of the IPO is Rs. 212 to Rs. 215 17 per equity share of face value Rs. 10. The total public issue size is 43,29,038 shares. The bid lot size for the issue is 65 equity shares.

The company plans to use the proceeds of the issue for repayment of borrowings, long-term working capital and general corporate purposes.

At the close of second day of subscription, the issue was subscribed 2.09 times. The cumulative bid received for the IPO were 90,47,805. Of which a total of 56,58,380 bids were received at cut-off price. The IPO close at 5:00 pm on April 26, 2019.