Dorf-Ketal Chemicals India IPO

About Dorf-Ketal Chemicals India IPO

The IPO consists of a fresh issue of equity shares aggregating up to ₹1,500 crore and an offer for sale of equity shares aggregating up to ₹3,500 crore, making the total offer size up to ₹5,000 crore. Each equity share has a face value of ₹5.

Objectives of Dorf-Ketal Chemicals India IPO

• Repayment/prepayment of all or part of the company’s outstanding borrowings.

• Investment in its subsidiary, Dorf Ketal Chemicals FZE, for repaying or prepaying its outstanding borrowings.

• Allocation for general corporate purposes.

Industry Outlook

India's specialty chemicals industry is poised for significant growth, driven by domestic demand from end-user industries such as pharmaceuticals, personal care, and textiles. The pharmaceutical sector is expected to grow at a CAGR of 14.01%, increasing from USD 59.20 billion in FY2024 to USD 130 billion in FY2030, while the textile industry is projected to reach USD 350 billion by FY2030. Export opportunities are robust, with India leveraging its cost advantage in labour and production to emerge as a competitive global supplier. Government policies, including the Production Linked Incentive (PLI) scheme with investments exceeding ₹1.97 lakh crore, are fostering growth by boosting domestic manufacturing and capacity. Technological advancements like digitalisation, green chemistry, and R&D investments further enhance production efficiency, align with sustainability goals, and cater to environmentally conscious customers.

Company Information

The company is a global manufacturer and supplier of specialty chemicals focused on research, development, and innovation for hydrocarbons and industrial supply chains, including oil and gas, refining, and petrochemicals. Established in 1992, it is one of India's leading producers in the development and application of specialty chemicals, with 16 manufacturing facilities across four countries, including eight in India. The company holds 542 patents outside India, with 99 U.S. patent registrations and 29 patents in India, making it a globally recognised brand in the specialty chemicals industry. Its marquee customer base includes renowned companies such as Reliance Industries, Petronas, Indian Oil Corporation, PPG Industries, Clariant, and Vedanta. The company offers products mainly in two categories: specialty chemicals for hydrocarbons and industrial specialty chemicals, addressing diverse customer needs across industries.

Risks of Dorf-Ketal Chemicals India IPO

• Dependence on hydrocarbon specialty chemicals revenue

A significant portion of the company's revenue (81.15% for six months ended September 2024) is derived from hydrocarbon specialty chemicals. Climate-related transition risks, such as evolving legislation, fuel conservation measures, and technological advancements, may lead to reduced demand for hydrocarbons, adversely impacting the company’s financial condition and operational results.

• Concentration of revenue from top customers

The company derives a substantial portion of revenues from its top 10 customers (33.03% for six months ended September 2024). Losing contracts or failing to maintain commercially viable terms with these customers could adversely affect the business, emphasising its reliance on key clients for stable operations and financial performance.

• Reliance on limited-source suppliers for raw materials

The company lacks long-term agreements with its raw material suppliers, depending on single or limited-source suppliers. Any increase in costs, quality issues, or supply chain disruptions could negatively affect production and profitability, posing a risk to smooth operations and the company's financial outcomes.

Anchor Investor Bidding Date: TBA

IPO Registrar and Book Running Lead Manager

Registrar: MUFG Intime India Private Limited

Book Running Lead Managers: JM Financial Limited, Citigroup Global Markets India Private Limited, HSBC Securities and Capital Markets (India) Private Limited, J.P. Morgan India Private Limited, Morgan Stanley India Company Private Limited, Motilal Oswal Investment Advisors Limited

Business Model

The company operates a business model focused on the research, development, and production of specialty chemicals for the hydrocarbon and industrial sectors. It generates revenue primarily through the sale of these specialised chemical products, leveraging its strong R&D capabilities and manufacturing networks to serve a diverse customer base across various industries.

Company Growth Trajectory

The company's revenue from operations exhibited consistent growth, increasing from ₹2,589.53 crore in FY22 to ₹3,866.48 crore in FY23 (a 49.31% growth) and further to ₹5,479.53 crore in FY24 (a 41.72% growth). Similarly, EBITDA grew steadily, rising from ₹381.80 crore in FY22 to ₹731.16 crore in FY23 (91.50% growth) and to ₹950.42 crore in FY24 (a 29.99% growth), reflecting strong operational performance.

How to Check Allotment Status of Dorf-Ketal Chemicals India IPO?

• Visit the Registrar's Website

To check the IPO allotment status for Dorf-Ketal Chemicals India IPO, visit the official website of MUFG Intime India Private Limited, the registrar for this IPO. On their IPO allotment status page, enter your Permanent Account Number (PAN), application number, or Demat account ID. Then, click the ‘Submit’ button to view your allotment status. Ensure you have the necessary details ready for a quick and accurate check.

• Check on the Bombay Stock Exchange Website

The Bombay Stock Exchange (BSE) also has an IPO allotment status page. Go to www.bseindia.com and find the 'Investors' tab. Under 'Investors', click on 'IPO'. This will take you to the IPO allotment status page.

On the BSE IPO page, follow these steps

• Select 'Equity' from the dropdown menu
• Choose 'Dorf-Ketal Chemicals India' in the next dropdown
• Enter your application number
• Enter your PAN
• Click 'Search'

Your Dorf-Ketal Chemicals IPO allotment status will be displayed.

• Verify on the National Stock Exchange Website

The National Stock Exchange (NSE) has an IPO Bid Verification module. Use this to check Dorf-Ketal Chemicals IPO allotment status.

Go to www.nseindia.com and find the 'Invest' tab. Click on 'Verify IPO Bids' under 'Resources & Tools'. On the NSE IPO Bid Verification page, enter:

• Application number
• PAN

Then click 'Submit'. Your Dorf-Ketal Chemicals IPO bid and allotment details will be displayed.

How to Apply for Dorf-Ketal Chemicals India IPO?

• Step 1: Log in to your Kotak Securities Demat account - Log in to your Demat account to access IPO investments. Next, select the current IPO section.
  
• Step 2: Specify IPO details - Enter the number of lots and the price you wish to apply for.
  
• Step 3: Enter UPI ID - After entering your UPI ID, click submit. This will place your bid with the exchange.
  
• Step 4: Mandate Notification - Your UPI app will receive a mandate notification to block funds.
  
• Step 5: Approve Request - Your funds will be blocked once you approve the mandate request on your UPI.