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The initial public offering (IPO) of Aether Industries was off to a slow start on the first day of the bidding process on Tuesday.

The issue, which kicked off earlier today, will remain open till Thursday, May 26. The company is selling its shares in the range of Rs 610-642 apiece to raise Rs 808 crore through the primary route.

According to the data from BSE, the investors made bids for 9,84,952 equity shares or 11 per cent as of 11.30 am compared to 93,56,193 equity shares on offer.

The quota for retail bidders was subscribed 21 per cent, whereas the allocation for non-institutional bidders was subscribed merely one per cent. The qualified institutional buyers kept away from the bidding process so far.

The company has reserved 50 per cent of the net offer for qualified institutional buyers (QIBs), whereas non-institutional buyers (NIIs) will get a 15 per cent allocation. The remaining 35 per cent shares will be given to the retail bidders.

Incorporated in 2013, Aether Industries is a manufacturer of specialty chemicals and sole play in some of the categories. The company is the largest manufacturer of 4MEP, T2E, NODG and HEEP products in the world by volume.

Aether Industries has two manufacturing sites at Sachin in Surat, Gujarat. As of March 31, 2022, its product portfolio comprises over 25 products which were sold to over 34 global companies in 18 countries and to over 154 domestic companies.

The majority of the brokerage firms are upbeat on the issue and have recommended subscribing to it following its strong financials, niche products and growth prospects over the year.

The company with its differentiated portfolio of market-leading products has focused on R&D to leverage its core competencies of chemistry and technology, said brokerage firm Hem Securities, while assigning a subscribe rating on the issue.

“It has long-standing relationships with a diversified customer base and with synergistic business models focused on large scale manufacturing, CRAMS and contract manufacturing. On the financial front, the company has shown strong and consistent financial performance.”

In terms of valuations, the post-issue TTM P/E works out to 75.6x, which is reasonable considering its historical performance, said Angel One. “It has a diversified customer base, strong financial track record and higher ROE.”

Considering all these positive factors, the brokerage firm believes the valuation is at reasonable levels and has recommended subscribing to the issue.

Aether Industries raised Rs 240.26 crore from anchor investors by allocating a total of 37,42,495 equity shares at Rs 642 apiece, according to a circular uploaded on the BSE website.

A total of 25 funds have been allocated shares in the anchor round. This included Goldman Sachs, Nomura,

Mutual Fund (MF), Aditya Birla Sun Life MF, Kotak MF, Axis MF, MF and Tata MF.

The company has cut the size of the fresh issue of equity shares to Rs 627 crore from Rs 757 crore planned earlier following the pre-IPO placement.

and Capital Company are the book running lead managers to the issue, whereas Link Intime India is the registrar to the issue.


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