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Allchem Lifescience, a Gujarat-based manufacturer specializing in active pharmaceutical ingredient (API) intermediates and specialty chemicals, has filed preliminary papers with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). The IPO comprises a fresh issue of equity shares totaling up to ₹190 crore and an offer for sale (OFS) of 71.55 lakh equity shares by promoters Kantilal Ramanlal Patel and Manisha Bipin Patel.
Established in 2017, Allchem Lifescience has developed the capability to manufacture 263 products, focusing on various chemistries in organic compounds. The company is recognized for producing piperazine derivatives, essential raw materials for APIs like quetiapine, used in treating schizophrenia and bipolar disorder. Their manufacturing facility is located in Vadodara, Gujarat, and they serve both domestic and international clients, including Alembic Pharmaceuticals, Indoco Remedies, and Neuland Laboratories.
Financially, Allchem Lifescience has demonstrated steady growth. From FY22 to FY24, its revenue from operations increased at a compound annual growth rate (CAGR) of 12.75%. For the six-month period ending September 30, 2024, and for FY24, FY23, and FY22, the revenue from operations stood at ₹78.45 crore, ₹137.42 crore, ₹105.72 crore, and ₹108.10 crore, respectively. Additionally, the profit after tax (PAT) experienced a CAGR of 28.65% from March 31, 2022, to March 31, 2024.
The company plans to allocate ₹130 crore from the fresh issue towards debt repayment, with the remaining funds used for general corporate purposes and to support business requirements. Emkay Global Financial Services is the sole book-running lead manager for the issue.
Investors may find Allchem Lifescience's IPO appealing due to its established market presence, diversified product portfolio, and consistent financial growth. The company's strategic focus on debt reduction and operational expansion further enhances its investment potential.
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