Paradeep Phosphates IPO

Paradeep Phosphates Limited is India’s third biggest private sector producer of non-urea fertilisers and second biggest in regards of Di-Ammonium Phosphate (“DAP”) volume sales As of March 2021 (Source: CRISIL Report). Paradeep Phosphates IPO will hit the market in 17 May 2022.

About Paradeep Phosphates Limited

DAP, three grades of Nitrogen-Phosphorus-Potassium (“NPK”) (specifically NPK-10, NPK-12, and NP-20), Zypmite, Phosphogypsum, and Hydroflorosilicic Acid (“HFSA”) are among the complex fertilisers that Paradeep Phosphates manufacture, trade, distribute, and sell.

Muriate of Potash (“MOP”), Ammonia, Specialty Plant Nutrients (“SPN”), and City compost are among the products they trade, distribute, and sell.

Their fertilisers are sold under the brand names ‘Jai Kisaan -Navratna’ and ‘Navratna’, which are well-known in the market.

Manufacturing Facility

A DAP and NPK production plant, as well as a Sulphuric acid production plant and a Phosphoric acid production plant, are all located in Paradeep, Odisha.

For the production of DAP and NPK, they use sulphuric and phosphoric acids. Their integrated business strategy, they feel, has been crucial to their success and a differentiating from their competition.

Their integrated business strategy enables them to increase profitability, improve capital efficiency, and maintain a competitive edge.

Footprints & Raw Materials

With a significant presence in the eastern portion of India, they have built a large sales and distribution network. Their solutions are distributed throughout 17 Indian states through a network of 11 local marketing offices and 1,324 stock locations.

As of March 2021, their network comprises 4,529 dealers and over 60,257 merchants, serving over 5 million farmers in India. Phosphate Rock, Phosphoric Acid, Sulphur, Ammonia, and MOP are among their major raw ingredients.

They get our raw materials both locally and from other nations including Morocco, Jordan, Qatar, and Saudi Arabia.

They have long-term supply agreements for numerous of major raw materials, including phosphate rock, ammonia, and sulphur.

Paradeep Phosphates IPO

Paradeep Phosphates Limited, headquartered in Bhubaneswar has submitted Draft Red Herring Prospectus(DRHP) to Securities and Exchange Board of India(SEBI) for initial public offering (IPO) of 1255 crores value equity share & 120,035,800 equity share on 12 August 2021.

The Offer includes 1255 crores value fresh equity shares and There is an offer for sell(OFS) of 120,035,800 equity shares by the promoters mentioned in the DRHP.

They are now got approval from Securities and Exchange Board of India(SEBI) to float the initial public offering (IPO) in the market.

Financials Trends

Particulars	For the year/period ended ( in Cr.)
		31-Mar-21	31-Mar-20	31-Mar-19
Total Assets		4,423.17	5,010.33	5,627.66
Total Revenue		5,183.94	4,227.78	4,397.21
Profit After Tax		223.27	193.22	158.96

Basic and Diluted Earnings Per Share

Financial Period	Basic EPS (in INR)	Diluted EPS (in INR)	Weight
Financial Year 2021	3.88	3.88	3
Financial Year 2020	3.36	3.36	2
Financial Year 2019	2.76	2.76	1
Weighted Average	3.52	3.52

Objects of the Issue

• Prepayment / repayment of all or a portion of the outstanding borrowings of the company to be availed on consolidated basis.
• To meet common corporate objectives.

Basis of the offer

The following are some of the basic criteria that contribute into determining the Offer Price:

1. Well-positioned to take advantage of favourable fertiliser sector dynamics in India, which are aided by favourable government regulations.
2. India’s second-largest producer of Phosphatic fertilisers.
3. Backward integration of plants and smart sourcing are driving raw material utilization.
4. Unused land and a safe and accredited production facility and infrastructure are ready for growth.
5. Their production plant is at a strategic position, with ample material storage, handling, and port services.
6. A well-known brand name with a large sales and distribution network.
7. Strong parentage, a seasoned management team, and well-known stockholders.

Paradeep Phosphates IPO Peer Comparison

S. No.	Face Value	Company Name	PE
1	1	Coromandel International Limited	19
2	10	Chambal Fertilizers Chemicals Limited	8
3	10	Deepak Fertilizers and Petrochemicals Limited	10

Paradeep Phosphates IPO Details

IPO Opening Date	17 May 2022
IPO Closing Date	19 May 2022
Issue Type	Book Building
Face Value	10 per  share
IPO Price	39 to 42 per equity share
Market Lot	350
Min Amount	14700
Listing At	BSE, NSE
Issue Size	–
Fresh Issue	1255 Crore
Offer for Sale	120,035,800 equity shares

Paradeep Phosphates IPO Date

Paradeep Phosphates IPO opening date is 17 May 2022, and the closing date is 19 May 2022. The issue may list on 30 May 2022.

IPO Opening Date	17 May 2022
IPO Closing Date	19 May 2022
Basis of Allotment Date	25 May 2022
Initiation of Refunds	26 May 2022
Credit of Shares to Demat Account	27 May 2022
IPO Listing Date	30 May 2022

Basis of Allotment

Type	% of Offer	Basis of Allotment
Qualified Institutional Buyer	50	Roughly  equivalent
Non Institutional Investor	15	Roughly  equivalent
Retail	35	Minimum level of 1 lot, based on availability, for every shareholder.

Paradeep Phosphates IPO Allotment Status

Allotment of equity stocks subject to the Fresh Issue and transfer of the Promoter Selling Shareholders’ OFS Stocks to the winning Bidders subject to the Offer for Sale. Nevertheless, the status of the allotment has yet to be revealed.

Here, you can find the Allotment Status of Paradeep Phosphates IPO.

Paradeep Phosphates IPO GMP

Paradeep Phosphates IPO Grey Market Premium is 0.50.

Date	GMP (in Rs)	Subject to Sauda	Kostak (in Rs)
May 2022
May 2022
May 2022
May 2022
May 2022
25 May 2022	0.50	0	0
24 May 2022	0	0	0
23 May 2022	0	0	0
22 May 2022	0	0	0
21 May 2022	1	0	0
20 May 2022	3	0	0
19 May 2022	2	0	0

Paradeep Phosphates IPO Review

Paradeep Phosphates IPO Review : if you are looking for answer of your question that Paradeep Phosphates IPO is good or bad then you can avoid this IPO.

Paradeep Phosphates IPO Risk

• The success of the agriculture sector, where their fertilisers are utilised, is critical to their business.
• Their business is cyclical in nature and is affected by climate circumstances.
• The impact of the coronavirus epidemic on their company is unknown and cannot be forecasted.
• Their firm, their Promoters, and their Directors are all involved in ongoing legal battles. Any negative decision in any of these processes might have a negative impact on their company.
• If They are unable to get or retain regulatory approvals for their products, they may not be able to market them, which might have a negative impact on their business.
• Their inability to grow or manage their distribution network efficiently may have a negative impact on their company.

Other Threats

• Their inability to correctly anticipate demand for their fertilisers and manage their inventories might hurt their bottom line.
• Their business relies on strong and well-known brands and trademarks, which may not be sufficiently secured against infringement by third parties.
• They have engaged in linked party transactions in the past and will do so again in the future.
• The financial conditions may not be correctly reflected in the Special Purpose Carve-out Financial Statements provided in their DRHP.
• Changes in technology may make their present technologies outdated or need a significant financial investment.
• They are exposed to foreign exchange risks, which might have a negative impact on their business.

Background

Paradeep Phosphates is part of the Adventz Group and OCP. Mr. Saroj Kumar Poddar is the present chairman of the Adventz Group, which was founded by the late Dr. K.K. Birla.

The Adventz Group is involved in a variety of industries, with a significant presence in agribusiness, engineering and infrastructure, and new lifestyles.

OCP, which was established in 1920 and has revenues of over US$6.3 billion in 2020, is one of the world ‘s renowned manufacturers of phosphate rock.

It works primarily in Morocco and Western Sahara, which, according to CRISIL Research, has roughly 70% of the world’s phosphate rock resources and is controlled 95% by the Moroccan government.

Business Approach

In their business, they think that powerful and identifiable brands are essential. Customers’ trust in such companies grows, and they are more likely to make a purchase.

They think that farmers in Eastern India are familiar with the brands “Jai Kisaan – Navratna” and “Navratna.” Almost all sorts of crops are catered to by them.

Their marketing operations, which are aimed at wholesalers and farmers, are able to build demand for their brand.

They include meetings with farmers, promotions at point-of-sale sites, field demonstrations, arranging bazaar days, and rural upliftment initiatives in certain areas.

Assistance

In addition, they have meetings with their dealers and retailers on a regular basis to strengthen their brand, present new solutions, and educate their dealers and retailers on the appropriateness of their products for certain crops.

In partnership with the Department of Agriculture of the Government of Odisha, they have also established a farmer training school in Bhubaneswar.

As part of the Adventz Group effort, they also have toll-free lines called “Hello Jai Kisaan,” which are manned by agricultural specialists who are well-equipped to assist farmers on scientific agriculture.

Their trained extension workers, known as ‘Jai Kisaan Krishi Salahakars,’ also assist them on the fields.

Awards

They have received numerous prestigious awards and recognitions over the years:

1. 19th Greentech Safety Award 2020 for outstanding achievement in category of industry sector safety excellence.
2. Environmental Protection Ward from the Fertilizer Association in India for NP/NPK fertilizer plant, Kalinga Safety Award 2019 from the Government of Odisha.
3. FAI Environmental Protection Award in NP/NPK Fertilizer Plants with Captive Acid Category for the year 2019-2020 by the Fertilizer Association of India.
4. ICONSWM Excellence Award 2019 at the 9th International Conference on Sustainable Waste Management towards Circular Economy.
5. Best Brand Platinum Award 2021 in Corporate Excellence category.

Paradeep Phosphates IPO Brokerage views

• Yes Securities : Not Updated
• Choice Brokering: Not Updated
• Axis Securities: Not Updated
• IIFL Securities: Not Updated
• Trade swift: Not Updated
• Anand Rathi : Not Updated
• ICICI Securities: Not Updated

Paradeep Phosphates IPO Subscription Status

Date	Day	QIB	NII	Retail	Employees	Total Subscription
17 May 2022	1
18 May 2022	2
19 May 2022	3

Promoters

• Zuari Maroc Phosphates Private Limited
• Zuari Agro Chemicals Limited
• OCP S.A
• The President of India

The Company was founded in 1981. Zuari Maroc Phosphates Private Limited (“ZMPPL”), a joint venture between Zuari Agro Chemicals Limited (“ZACL”) and OCP Group S.A. (“OCP”), presently owns 80.45% of the company’s equity share capital, with the rest owned by the Indian government.

Promoters’ Holding

Pre Issue Share Holding	100 %
Post Issue Share Holding