Laxmi Organics Industries IPO opens today: Should you subscribe to the issue?


LAST UPDATED: March 15, 2021, 2:14 p.m.

New Delhi (Anish Yande): Laxmi Organics Industries is launching the initial public offering today. The chemicals manufacturer is aiming to raise Rs 600 crores through its issue. The IPO would be open for subscriptions from March 15 to March 17, 2021.

Laxmi Organics Industries IPO details:

The public issue of Laxmi Organics Industries would consist of a fresh issue of Rs 300 crore and an offer for sale of Rs 300 crore. The promoter of the company, Yellow Stone Trust would be issuing the offer for sale. 

The price band for the Laxmi Organics Industries issue has been fixed at Rs 129–130 per share with a face value of Rs 2 for each share. Investors are required to bid a minimum of one lot of the issue.  

At the upper price band, the minimum bidding size of the issue would is Rs 14,950. One lot of the issue would constitute 115 shares and lots of the issue can be bid in multiples of 115 shares. 

The chemicals manufacturer has raised Rs 200 crores through its pre-IPO placement issue and has issued 1,55,03,875 equity shares under the issue. 

Before its IPO, Laxmi Organics Industries had raised Rs 180 crore from anchor investors before the issue. The chemicals manufacturer would be allocating 1,38,46,153 shares at Rs 130 to 15 anchor investors. 

Laxmi Organics Industries Financial track record:

Up to 50 percent of the Laxmi Organics Industries issue has been reserved for qualified institutional buyers, 35 percent of the issue has been reserved for retail investors and 15 percent of the issue is reserved for non-institutional bidders.

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The funds generated from the Laxmi Organics issue would be utilized for investment in its wholly-owned subsidiary, Yellowstone Fine Chemicals Private Limited. The company would utilize the funds for its requirements in capital expenditure. The company would be expanding its manufacturing facilities. 

Domestic investors such as  ICICI Prudential Mutual Fund and Aditya Birla Mutual Fund have been allocated the largest amount of shares at 10,76,860 shares. The allocated issue comprises 7.78 percent of the total issue amounting to around Rs 14 crores. 

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