Rite Zone Chemcon India Limited is entering into the capital market through SME IPO. The company will issue 11,95,200 equity shares of Rs.10 each. Issue Price is fixed at Rs.75 per share and the company will raise Rs.8.96 crore through this IPO.
The issue opens on October 31, 2022, and will close on November 2, 2022. The minimum application is to be made for 1600 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on NSE SME. Expert Global Consultants Private Limited is the Sole Lead Manager of the issue and Skyline Financial Services Private Ltd. is the registrar to the issue. Objects of Issue are to part finance the Working Capital Requirements and undertake effectively some of the general corporate goals.
|IPO Opens on||October 31, 2022|
|IPO Closes on||November 2, 2022|
|IPO Price||Rs.75 per share|
|Lot Size||1600 share|
|Issue Size||11,95,200 equity shares|
|Aggregating up to||Rs.8.96 crore|
|Issue Type||Fixed Price Issue IPO|
|Listing at||NSE SME|
|Lead Manager||Expert Global Consultants Private Limited|
|Registrar||Skyline Financial Services Private Ltd|
Rite Zone Chemcon India Ltd. deal in a range of construction chemicals and concrete products. The Company offers complete construction solution by supplying a complete range of various chemical products related to civil construction, infrastructure, building & structure including pre-construction or post construction as well supplying all types of concrete required for construction and infrastructure developments. These products are used to speed up the process or add more sustainability and strength to the structures. The addition of construction chemicals to various building materials during the construction work improves performance, workability, adds functionality, and protects the basic or customized elements of a structure.
The Company`s product range includes Concrete Admixture, Water Proofing Systems, Concrete Lubricator, Engineering Grouts, Industrial Flooring, Concrete Repairs, Curing Compound & Mould Release Agent, Surface Treatment, Tiling & Block Products. The Company also deals in a range of concrete products such as Slump Concrete, Flowable Concrete, Self-Compaction Concrete (SCC), Light Weight Concrete, Stamp Concrete, Color Concrete, PQC Concrete, Early Strength Concrete, Reinforce Concrete, Shotcrete Concrete, Precast Concrete, Pile Concrete, Air Entrench Concrete, Prestressed Concrete and High Strength Concrete etc.
The Company also outsources its chemical products production to third party manufacturer. They are one of the important producers of Sulphonated Naphthalene, Formaldehyde Condensate as well as Polycarboxylate Ether which are the key raw materials for the manufacture of its products. The Company has also tied up with three concrete manufacturers in Maharashtra for production of concrete. Majority of these manufacturers are located on the outskirts of Mumbai city, which enables continuous and smooth supply of concrete to overall Mumbai, Navi Mumbai and Thane city.
The management assures that its production process undergoes strict quality control check-batch to batch. The facilities are backed by sophisticated R&D laboratory equipped with latest testing equipment.
The Plus Point
The Company has taken over the running business of M/s Maruti Infrachem Solutions (Bhavesh Babulal Bhandari HUF). Karta of HUF, Mr. Bhavesh Bhandari is also promoter of the company. The Company has taken over all the assets of the company for total consideration of Rs 197.47 Lakhs. The Maruti Infrachem Solutions has very impressive turnover.
When the financials of the M/s Maruti Infrachem Solutions will be added in this quarter the books will show its hidden strength. So far the numbers are not reflected in the company`s current year`s financials since the Company took over the running business of M/s Maruti Infrachem Solutions on March 01, 2022. When it is added we are sure to see a very impressive spike in the company`s numbers.
- Asset Light business model with low fixed overheads
- Strong R&D establishment for constant improvement in existing products as well as development of new products
- It has wide product portfolio with a focus on quality.
- Guaranteed quality assurance and customer satisfaction with existing committed workforce
- Longstanding customer relationships leading to increased business opportunities.
- The true picture will emerge soon as henceforth the results will include numbers of Maruti Infrachem Solutions as well, a fact that cannot be ignored.
- Presently the Company has reported RONW of 9.27% and EPS of 1.49. However this cannot be considered for the sake of comparison as it considers all the shares, whereas the PAT of Maruti Infrachem Solutions is taken for only one month post its takeover.
- The Company`s fundamentals will show good turnaround next year and its performance should not be judged on the basis of numbers as per DRHP.
- It is a good opportunity to invest in a company which apparently appears overvalued, but is highly undervalued when true numbers are seen, considering the multiples of other concrete chemicals companies.