Nova Agritech Ltd, a Hyderabad-based company that manufactures and markets products for soil health, plant nutrition and crop protection, is launching its initial public offering (IPO) today. The issue will close on January 25, 2024. Here are some key points to know before you subscribe:
- The IPO price band is set at Rs 39 to Rs 41 per share, with a face value of Rs 2 per share. The minimum lot size is 365 shares and the maximum lot size is 10,530 shares.
- The IPO comprises a fresh issue of 27.32 million shares aggregating to Rs 112 crore and an offer for sale of 7.76 million shares aggregating to Rs 31.81 crore by Nutalapati Venkatasubbarao, one of the promoters.
- The net proceeds from the fresh issue will be used for setting up a new formulation plant by its subsidiary Nova Agri Sciences, expanding the existing formulation plant, and general corporate purposes.
- The company has raised Rs 43.14 crore from four anchor investors, including SBI Mutual Fund, HDFC Mutual Fund, ICICI Prudential Mutual Fund and Axis Mutual Fund, by allotting 10.52 million shares at Rs 41 per share.
- The company has a diversified product portfolio of over 200 products, including soil health products, crop nutrition products, biostimulants, biopesticides, integrated pest management products, new technologies and crop protection products.
- The company has a pan-India presence with a network of over 1,000 distributors and dealers across 18 states and one union territory. It also exports its products to Bangladesh, Nepal and Sri Lanka.
- The company has two manufacturing facilities in Hyderabad with a combined installed capacity of 36,000 MT per annum. It also has a research and development centre with a team of over 40 scientists and technicians.
- The company’s revenue from operations grew at a compound annual growth rate (CAGR) of 19.6% from Rs 144.62 crore in fiscal 2021 to Rs 210.93 crore in fiscal 2023. Its profit after tax grew at a CAGR of 29.8% from Rs 12.77 crore to Rs 20.49 crore in the same period.
- The company’s return on net worth was 23.9% in fiscal 2023, while its earnings per share was Rs 3.14. Its net asset value per share was Rs 13.15 as of September 30, 2023.
- The company faces competition from both domestic and international players in the agrochemical industry, such as UPL, PI Industries, Rallis India, Bayer CropScience, BASF India and Syngenta India.
- The company is exposed to risks such as fluctuations in raw material prices and availability, regulatory changes, environmental concerns, climatic conditions and seasonal demand.