Laxmi Organic Industries all set to launch IPO to raise Rs 600 crore

Speciality chemical manufacturer, Laxmi Organic Industries, is set to open its maiden public offer for bidding on March 15. The Rs 600-crore public offer consists of a fresh issue of Rs 300 crore and an offer for sale of Rs 300 crore by promoter Yellow Stone Trust. The issue will close on March 17.

The issue size has been reduced to Rs 600 from Rs 800 crore after the pre-IPO placement.

The company has already raised Rs 200 crore by issuing 1,55,03,875 equity shares in a pre-IPO placement, which resulted into reduction of fresh issue size to Rs 300 crore from Rs 500 crore earlier.

Laxmi Organic intends to utilise fresh issue and pre-IPO placement funds for investment in wholly-owned subsidiary, Yellowstone Fine Chemicals (YFCPL), for setting up of a manufacturing facility for fluorospecialty chemicals, and working capital requirements; for capital expenditure requirements, for expansion of SI manufacturing facility; company's own working capital requirements; and repayment of debt availed by the company and subsidiary, Viva Lifesciences (VLPL).

The company operates in the sector where there are many listed players like Aarti Industries, Atul, Fine Organic Industries, Navin Flourine International, Rossari Biotech and SRF.

In February this year, the company received approval from the capital market regulator Sebi to go ahead with the IPO plan.

Laxmi Organic is currently among the largest manufacturers of ethyl acetate in India with a market share of approximately 30 percent of the Indian ethyl acetate market, a Frost & Sullivan report said. Post completion of the YCPL acquisition, its market share in the ethyl acetate market will enhance further.