Retail investors take JG Chemicals IPO past full subscription on Day 1. Check GMP and other details

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The initial public offer (IPO) of Zinc Oxide maker JG Chemicals, which opened for subscription earlier today, was fully booked so far on the first day of bidding. The retail portion of the issue was fully subscribed, while NII category followed closely with 93% subscription.

There were no bids yet in the QIB category of the IPO, which closes on March 7.

JG Chemicals IPO review

Analysts advised investors to subscribe to the issue as the company is a market leader with a strong customer base. At the upper price band, the issue is valued at an EV/EBITDA of 12.3x based on FY23 earnings.

“The favorable demand outlook in automotive, rubber and ceramics, along with expected revival of the chemical industry in early FY25, positions JG Chemicals for sustained growth and market leadership,” said Arihant Capital, while recommending a subscribe.
JG Chemicals IPO opens for subscription. Should you bid?

JG Chemicals IPO price band

JG Chemicals has fixed a price band of Rs 210-221 per share for its maiden public offer. At the upper end, the company plans to raise Rs 251 crore.

JG Chemicals GMP

In the unlisted market, the company’s shares are trading with a GMP of Rs 60.

Other details

JG Chemicals Ltd is India’s largest zinc oxide manufacturer, employing the French (indirect) process for production. It holds a 30% market share in India and is among the top ten global manufacturers.

Offering over 80 grades, its products serve diverse industries including rubber, ceramics, paints, pharmaceuticals, and more. With decades of experience, it has built strong relationships with customers worldwide.

Its subsidiary, BDJ Oxides, holds the coveted IATF certification, making it a preferred supplier for tyre manufacturers. The company caters to 200 domestic customers and 50 global customers spanning across more than 10 countries.

For the nine months ended December 2023, the company’s total income stood at Rs 491 crore and profit after tax was at Rs 18.5 crore. In FY23, total income jumped 27% year-on-year to Rs 794 crore, while profit increased 32% to Rs 56.8 crore.

Centrum Capital, Emkay Global Financial Services, and Keynote Financial Services are the book-running lead managers to the issue.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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