Laxmi Organic IPO Review: Bidding for shares? Subscribe or not? Top things to know

Laxmi Organic IPO Review: Leading manufacturer of ethyl acetate and the only manufacturer of diketene derivatives in India, Laxmi Organic Industries Limited has launched its Initial Public Offer (IPO) on March 15, 2021. The offer will close on March 17, 2021 and the company has fixed the price band at Rs 129-130 per equity share.

Laxmi Organic IPO Review: Bidding for shares? Subscribe or not? Subscribe!

According to Marwadi Shares and Finance Ltd, "Considering FY20 adjusted EPS of 2.66 on a post-issue basis, the company is going to list at a P/E of 48.82X with the market cap of Rs.34,276 million. The peers of the company namely Aarti Industries Ltd is at P/E of 24.92X and Fine Organics Industries Ltd is at 35.46X. We recommend to ‘Subscribe’ this issue as long-term prospects of this stock look promising with healthy demand from the end-user industry driving revenues for this company."

Here are top things to know about Laxmi Organic Industries IPO:-

Laxmi Organic Industries IPO: Issue Details

 Laxmi Organic Industries: Company’s Overview

- Laxmi Organic Industries Ltd is one of the leading manufacturers of Acetyl Intermediates and Specialty Intermediates.

- They are one of the largest manufacturers of ethyl acetate with a 30% market share in India and the only manufacturers of diketene derivatives with 55% market share in India in terms of revenue.

- Company’s products find application in end user industries such as pharmaceuticals, agrochemicals, dyes & chemicals, inks & coatings, paints, printing & packaging, flavors & fragrances, adhesives and other industrial applications.

- Contribution of exports to total revenue stands at 23.17% and is one of the largest exporters of ethyl acetate in India

Laxmi Organic Industries: Valuations

-  Considering FY20 adjusted EPS of 2.66 on a post-issue basis, the company is going to list at a P/E of 48.82X with the market cap of Rs.34,276 million. The peers of the company namely Aarti Industries Ltd is at P/E of 24.92X and Fine Organics Industries Ltd is at 35.46X

- We recommend to ‘Subscribe’ this issue as long term prospects of this stock look promising with healthy demand from end user industry driving revenues for this company

Laxmi Organic Industries: Financial Snapshot

Promoters and Management Details 

Ravi Goenka- Chairman and Managing Director

Harshvardhan Goenka - Executive Director - Business Development and Strategy

Industry Overview

Indian Acetyl market is projected to grow at 6.6% growth rate over the next five years owing to the demand from the end use applications. The Acetyl market is valued at USD 1.5 Bn in 2019 which is expected to reach USD 2.1 Bn by the end of year 2024.