JG Chemicals IPO: Top Things to Know Before Subscribing to The Issue

JG Chemicals Limited initiated its initial public offering (IPO) on March 5, 2024, and the public subscription period will continue until March 7, 2024. The price range for the JG Chemicals IPO is set at Rs 210 to Rs 221 per equity share. The company’s objective is to secure funds amounting to Rs 251.19 crore, with Rs 165 crore allocated for the issuance of new shares and the remaining Rs 86.19 crore earmarked for the Offer for Sale (OFS) route.

About the Company

JG Chemicals Limited, and its subsidiary, BDJ Oxides Private Limited are part of the BDJ Group and have been producing Zinc Oxide since its inception in the year 1975. It started with a small plant in Kolkata in 1975 with a capacity of about 600 MTPA. The company is India’s largest zinc oxide manufacturer. It has a capacity of close to 60,000 MTPA production of Zinc Oxide and three manufacturing facilities. In addition to this, it has a production capacity of 10,000 MTPA of Zinc Sulphate, according to the company website.

Price Band

The public issue of the company features a specified price range set at Rs 210 to Rs 221 per equity share.

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Issue Size

The IPO comprises a combination of fresh shares and an Offer for Sale (OFS). Out of the total amount of Rs 251.19 crore, Rs 165 crore is targeted for the issuance of new shares. The remaining Rs 86.19 crore was allocated for the OFS.

IPO Reserve Portion

• Qualified Institutional Buyers (QIB): Not more than 50% of the shares in the public issue
• Non-Institutional Institutional Investors (NII): Not less than 15% of the shares in the public issue
• Retail Investors: Not less than 35% of the offer

Company Financials

Objectives of the Issue

The generated funds totaling Rs 910 crore will be directed towards BDJ Oxides, a subsidiary of the company. These funds will be allocated for purposes such as repayment, supporting capital expenditure for the establishment of a research and development center, and addressing the long-term working capital needs of the subsidiary. Additionally, a sum of Rs 35 crore from the issue will be earmarked for financing the company’s long-term working capital.

Disclaimer: The information provided in this blog post is for informational purposes only and should not be construed as investment or trading advice. The author is not a financial advisor and does not have any professional qualifications in this area. The author does not guarantee the accuracy or completeness of the information provided. Any action you take based on the information in this blog post is done at your own risk. Please consult with a financial advisor before making any investment.