Anupam Rasayan plans to raise Rs 800 crore through IPO later this year

Incorporated in 1977, Anupam Rasayan caters to market segments spanning agrochemicals, anti-bacterial, polymers, pharmaceuticals, and material sciences

Specialty chemicals firm Anupam Rasayan (ARIL) plans to tap the market for an initial public offering (IPO) later this year, said two people familiar with the matter. They said the firm plans to raise Rs 600-800 crore and has appointed three investment bankers — Axis Capital, JM Financial, and IIFL — to manage the share sale. An email sent to the company, however, did not elicit a response.
 
Incorporated in 1977, ARIL caters to market segments spanning agrochemicals, anti-bacterial, polymers, pharmaceuticals, and material sciences. The firm clocked revenues of Rs 349 crore for financial year 2017-18 (FY18), with a profit after tax of Rs 39 crore.
 
According to a November 2018 CRISIL report, ARIL has an established market position in the specialty chemical business, backed by a healthy product portfolio, strong clientele, and long-term contract manufacturing agreements. It also said the company planned to undertake total capex of around Rs 800 crore from FY17 to FY20.

“ARIL has a strong and reputed customer base, which includes BASF Grenzach GmbH, Bayer Crop Sciences, and Syngenta Asia Pacific PTE. Continuous R&D efforts have helped widen its product portfolio, cater to a larger customer base, and record revenue growth over the past few years,” the report stated. Specialty chemicals contributed 22 per cent of the chemical industry, with a market size of $35.9 billion, according to a Ficci report. The demand for specialty chemicals is estimated to grow at a compound annual growth rate of 12-14 per cent from FY19-22, driven by investments in end-user industries like personal care, textiles, and packaging.
 
Specialty chemical companies accelerated their capex plans, driven by strong growth visibility and emerging opportunities. The aggregate capex is expected to reach Rs 6,170 crore over FY19-21, 60 per cent higher than the Rs 3,770 crore spent between FY16-18, according to a report by William O’Neil India.
 
India also scored in low-cost skilled labour. The average labour cost in China over 2005-2015, for instance, clocked a CAGR of 19–20 per cent, compared with 4–5 per cent in India, the report noted.