JG Chemicals IPO Breakdown: A Comprehensive Overview

IPO Details

Bidding Dates	5th Mar ‘24 – 7th Mar ‘24	Closes on	7th Mar ‘24 4:50 PM
Lot Size	67	Price Range	₹210 – ₹221
Min. Investment	₹14,070	Issue Size	251.19Cr
Docs	RHPH DRHP	Apply Now	Groww Zerodha
Registrar	Kfin Technologies Limited	Lead Manager	Centrum Capital Limited Emkay Global Financial Services Ltd Keynote Financial Services Ltd
IPO Type	Mainboard	Listing at	BSE, NSE
Issue Type	Book Built Issue IPO	Anchor Investment	75.36Cr
Total Issue Size	11,366,063 shares (aggregating up to ₹251.19 Cr)	Fresh Issue Offer for Sale	7,466,063 shares (aggregating up to ₹165.00 Cr) 3,900,000 shares of ₹10 (aggregating up to ₹86.19 Cr)
Share holding pre issue	31,720,000	Share holding post issue	39,186,063
Promoter Holding Pre Issue	100%	Promoter Holding Pre Issue

IPO Timeline

IPO Open Date	Tuesday, March 5, 2024
IPO Close Date	Thursday, March 7, 2024
Basis of Allotment	Monday, March 11, 2024
Initiation of Refunds	Tuesday, March 12, 2024
Credit of Shares to Demat	Tuesday, March 12, 2024
Listing Date	Wednesday, March 13, 2024
Cut-off time for UPI mandate confirmation	5 PM on March 7, 2024

Subscription Status

On March 7, 2024, at 6:21:00 PM, the JG Chemicals IPO recorded a robust subscription rate of 28.52 times. Specifically, the public issue saw significant participation with subscription rates of 18.03 times in the retail category, 32.33 times in the Qualified Institutional Buyers (QIB) category, and an impressive 47.92 times in the Non-Institutional Investors (NII) category.

Category	Subscription (times)
QIB	32.33
NII	47.92
bNII (bids above ₹10L)	50.26
sNII (bids below ₹10L)	43.24
Retail	18.03
Total	28.52

Total Application : 1,012,547

IPO GMP

JG Chemicals made its stock exchange debut on March 13, 2024. With a subscription rate of 28.52x, the IPO garnered significant interest from investors. The last Grey Market Premium (GMP) for JG Chemicals IPO stood at ₹5, as of March 13, 2024, at 10:33 AM, suggesting a potential profit/loss of 2.26%.

Initially priced at ₹221.00 during the IPO, JG Chemicals commenced trading at ₹209, indicating a -5.43% decrease from the allotment price.

The anticipated IPO listing price, according to the grey market, was ₹226, positioned below the GMP price and indicating a negative listing outlook for GMP.

Disclaimer: The GMP prices provided here are purely for informational purposes related to the grey market. We neither engage in nor endorse trading or dealings in the grey market or its rates (sub2). Additionally, we do not recommend participating in grey market trading.

Allotment Status

Allotment status can be checked at: Kfin Technologies Limited

Listing Details

Listing Date	March 13, 2024
BSE Script Code	544138
NSE Symbol	JGCHEM
ISIN	INE0MB501011
Final Issue Price	₹221 per share

Pre-Open Sessions

The Pre-Open Session is a vital phase during the listing day of a company’s shares on the stock exchange, specifically known as the pre-open for IPO or IPO pre-market session.

• Pre-Open Sessions: NSE
• Pre-Open Sessions: BSE

Listing Day Trading Information

Price Details	BSE	NSE
Final Issue Price	₹ 221.00	₹ 221.00
Open	₹ 211.00	₹ 209.00
Low	₹ 181.20	₹ 181.30
High	₹ 213.75	₹ 213.75
Last Trade	₹ 184.65	₹ 184.80

About JG Chemicals

Established in 1975, JG Chemicals Limited stands as a prominent zinc oxide manufacturer, providing a diverse range of over 80 grades of zinc oxide to both the Indian and international markets. The extensive product portfolio caters to various industrial applications, including rubber (for tires and other rubber products), ceramics, paints and coatings, pharmaceuticals and cosmetics, electronics and batteries, agro-chemicals and fertilizers, specialty chemicals, lubricants, oil and gas, and animal feed.

As of December 31, 2023, the company boasts an aggregate installed capacity of 77,040 MTPA, strategically distributed across three state-of-the-art manufacturing facilities located in (i) Jangalpur (Kolkata, West Bengal), (ii) Belur (Kolkata, West Bengal), and (iii) Naidupeta (Nellore District, Andhra Pradesh). Ensuring high-quality standards, all of the company’s manufacturing facilities hold accreditation for ISO 9001:2015, ISO 45001:2018, and ISO 14001:2015. This underscores the company’s commitment to maintaining excellence in its operations.

• Parent Organisation: JG Chemicals Limited
• Founded: 1975
• Managing Director: Mr. Anirudh Jhunjhunwala

Pros

• The company boasts an installed capacity of 59,904 MTPA for zinc oxide, 7,056 MTPA for zinc ingots, and 10,080 MTPA for zinc sulphate and allied chemicals. Notably, the Naidupeta Facility has recently augmented its capacity by 13,440 MTPA for zinc oxide and 10,080 MTPA for zinc sulphate and allied chemicals.
• Offering a comprehensive range, the company provides over 80 grades of zinc oxide, catering to diverse end-use industries.
• Financially, the company reported substantial revenue from operations, amounting to Rs. 435.30 cr, Rs. 612.83 cr, and Rs. 784.58 cr in the fiscal years 2021, 2022, and 2023, respectively.
• Over the last three fiscal years, the company has successfully served more than 250 customers, with approximately 90% of them being repeat customers, indicating a high level of customer satisfaction.
• Utilizing the French process, the company employs advanced pulse jet bag filters and combustion systems in the manufacturing process of various zinc oxide grades. This strategic approach ensures higher productivity, low energy consumption, and adherence to emission norms, aligning with the company’s commitment to modern and sustainable manufacturing practices.

Cons

• The company’s primary revenue source is the sale of zinc oxide in various grades, accounting for 99.03%, 98.75%, 98.30%, and 98.54% of total income for the nine months ending December 31, 2023, and Fiscals 2023, 2022, and 2021, respectively. A decline in the demand for zinc oxide poses a potential risk to the company’s business and financial performance.
• Significant reliance on the operations of its material subsidiary, BDJ Oxides Private Limited, means any underperformance by the subsidiary could adversely impact the company’s business, financial condition, and operational results.
• The company’s revenue stream is concentrated, with its top 10 customers contributing Rs. 374.57 cr, Rs. 596.98 cr, Rs. 463.5 cr, and Rs. 333.72 cr during the nine months ended December 31, 2023, Fiscal 2023, Fiscal 2022, and Fiscal 2021, respectively. These figures account for 77.02%, 76.09%, 75.63%, and 76.67% of its revenue from operations. Such concentration poses a risk to the company’s revenue stability.
• Heavy dependence on procuring raw materials from overseas suppliers, without long-term agreements, exposes the company to potential adverse effects from increased costs or shortages. Any disruption in the availability or price of raw materials could negatively impact the company’s business and operational results.
• Pending litigations involving the company, its subsidiary, and certain directors carry the risk of adverse decisions leading to liabilities, penalties, and detrimental effects on the company’s business, operational results, and financial condition.
• Stringent quality requirements, regular inspections, and audits shape the company’s product sales, and non-compliance with these standards could have adverse implications for business prospects and financial performance. It could potentially result in the cancellation of existing and future orders.

Financials

Amount in ₹ Crore
Period Ended	31-Dec-23	31-Mar-23	31-Mar-22	31-Mar-21
Assets	271.26	297.79	264.14	209.94
Revenue	491.1	794.19	623.05	440.41
Profit After Tax	18.51	56.79	43.13	28.8
Net Worth	217.86	199.89	147.66	108.48
Reserves and Surplus	193.22	175.67	151.23	107.17

IPO Objectives

The company plans to allocate the Net Proceeds for the following purposes:

Investment in Material Subsidiary (BDJ Oxides):

• Repayment or pre-payment, either in full or in part, of all or certain borrowings obtained by its Material Subsidiary.
• Funding the capital expenditure requirements for establishing a research and development center situated in Naidupeta, Andhra Pradesh (R&D Centre).
• Meeting the long-term working capital requirements of the Material Subsidiary.

Funding Long-term Working Capital Requirements of the Company; and

General Corporate Purposes.

IPO Lot Size

Investors have the option to bid for a minimum of 67 shares and in multiples thereof. The table below illustrates the minimum and maximum investment at cut-off price, both in terms of shares and corresponding amounts, for retail investors and High Net Worth Individuals (HNI).

Application	Lots	Shares	Amount
Retail (Min)	1	67	₹ 14,807
Retail (Max)	13	871	₹ 1,92,491
S-HNI (Min)	14	938	₹ 2,07,298
S-HNI (Max)	67	4,489	₹ 9,92,069
B-HNI (Min)	68	4,556	########

IPO Reservation

Investor Category	Shares Offered	Maximum Allottees*
Anchor Investor Shares Offered	3,409,818 (30.00%)	NA
QIB Shares Offered	2,273,214 (20.00%)	NA
NII (HNI) Shares Offered	1,704,910 (15.00%)
bNII > ₹10L	1,136,606 (10.00%)	1,211
sNII < ₹10L	568,303 (5.00%)	605
Retail Shares Offered	3,978,122 (35.00%)	59,374
Total Shares Offered	11,366,064 (100%)

*The term “Maximum Allottees” refers to the highest number of Retail Individual Investors (RIIs) and Non-Institutional Investors (NIIs) to whom shares will be allocated, particularly in cases of oversubscription.

The formula for calculating Maximum Allottees is as follows:
Maximum Allottees = Number of shares reserved/Minimum number of shares to be allotted per respective category

It’s important to note that “Maximum Allottees” is not applicable to other categories, where allotment follows a pro-rata basis.

JG Chemicals Limited Contact Details

JG Chemicals Limited
34A, Metcalfe Street, Kolkata – 700 013
Phone: +91 33 4014 0100
Email: [email protected]
Website: https://jgchem.com/

Apply Now

Groww	Zerodha

Indian Share Market FAQs

FAQs Table: Indian Share Market
Question	Answer
What is the Indian share market?	The Indian share market, also known as the stock market, is a platform where buyers and sellers trade financial instruments, primarily stocks and securities, representing ownership in companies.
How many stock exchanges are there in India?	India has two major stock exchanges: the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). Both play a crucial role in the Indian capital market.
What are equity shares?	Equity shares represent ownership in a company and entitle shareholders to voting rights and a share in the company’s profits. They are a common form of investment in the share market.
What is a stock index?	A stock index is a statistical measure that reflects the performance of a group of stocks in the market. In India, indices like Nifty 50 and Sensex are widely used to gauge market trends.
How can I buy shares in the Indian share market?	To buy shares, you need to open a demat and trading account with a registered stockbroker. Once the accounts are set up, you can place buy orders through the broker’s trading platform.
What is a demat account?	A demat account (dematerialized account) holds shares and securities in electronic form, eliminating the need for physical share certificates. It facilitates easy and secure share trading.
What is a trading account?	A trading account is used to execute buy and sell orders in the stock market. It is linked to your demat account, allowing seamless transfer of shares bought or sold in the market.
What is intraday trading?	Intraday trading involves buying and selling shares within the same trading day. Traders aim to capitalize on short-term price movements to make profits.
How are stock prices determined?	Stock prices are determined by supply and demand dynamics in the market. Various factors, including company performance, economic indicators, and market sentiment, influence stock prices.
What is the role of SEBI in the Indian stock market?	The Securities and Exchange Board of India (SEBI) is the regulatory authority overseeing the Indian stock market. It ensures investor protection, market integrity, and regulates stock market entities.
What is a mutual fund?	A mutual fund is an investment vehicle that pools money from multiple investors to invest in a diversified portfolio of stocks, bonds, or other securities.
How can I invest in mutual funds?	To invest in mutual funds, you can approach Asset Management Companies (AMCs) directly or through registered intermediaries like mutual fund distributors and online platforms.
What is a dividend?	A dividend is a portion of a company’s profits distributed to its shareholders. Companies may choose to pay dividends to reward investors and provide them with a share in the company’s earnings.
What is the difference between BSE and NSE?	BSE (Bombay Stock Exchange) and NSE (National Stock Exchange) are two major stock exchanges in India. The key difference lies in their trading systems, index calculation methods, and historical significance.
How does the stock market impact the economy?	The stock market is considered a barometer of the economy. A thriving stock market can boost investor confidence, attract investments, and positively influence economic indicators like GDP growth.
What is a blue-chip stock?	Blue-chip stocks are shares of well-established, financially stable, and reputable companies with a history of consistent performance. They are considered less risky and are often part of major stock indices.
What is a bear market?	A bear market is characterized by declining stock prices, pessimism, and a general negative sentiment in the market. Investors may adopt a cautious approach as bear markets indicate economic downturns.
What is a bull market?	A bull market is characterized by rising stock prices, optimism, and positive investor sentiment. Bull markets generally reflect economic growth and encourage investors to engage in buying activities.
How does online trading work?	Online trading involves using a trading platform provided by a broker to execute buy and sell orders electronically. Investors can access real-time market data, place orders, and monitor their portfolio online.
What is a circuit breaker in the stock market?	Circuit breakers are mechanisms that temporarily halt trading in the stock market in the event of sharp price movements. They provide a cooling-off period to prevent panic selling or buying.
What is the significance of IPOs in the stock market?	Initial Public Offerings (IPOs) bring new companies to the stock market, allowing them to raise capital by issuing shares to the public. IPOs attract investor attention and contribute to market dynamics.
How are stock market indices calculated?	Stock market indices are calculated based on the weighted average of the stock prices of a select group of companies. Indices represent the overall performance of the market or specific sectors.
What is the difference between Nifty and Sensex?	Nifty is the flagship index of the NSE, representing the performance of the top 50 companies, while Sensex is the benchmark index of the BSE, consisting of 30 major companies. Both are widely followed indices.
What is a stock split?	A stock split is a corporate action in which a company increases the number of its outstanding shares, reducing the share price. It aims to make shares more affordable for a broader range of investors.
How do I analyze a stock before investing?	Stock analysis involves evaluating a company’s financial health, performance, management, industry trends, and other factors. Fundamental analysis and technical analysis are common approaches to stock analysis.
What is the role of a stockbroker?	A stockbroker acts as an intermediary between buyers and sellers in the stock market. They facilitate the execution of trades, provide market insights, and offer investment advice to clients.
What is the role of market makers in the stock market?	Market makers facilitate liquidity in the market by continuously quoting buy and sell prices for a specific set of stocks. They play a crucial role in maintaining an orderly and liquid market.
What is a Stop-Loss order?	A Stop-Loss order is a pre-set order to sell a security when it reaches a specific price, limiting potential losses for investors. It is a risk management tool commonly used in stock trading.
How do I calculate my profit or loss in the stock market?	The profit or loss in the stock market is calculated by taking the difference between the selling price and the buying price of a security, factoring in transaction costs and other associated expenses.
What is the role of financial news in stock market investing?	Financial news provides information on market trends, company performance, economic indicators, and global events that impact the stock market. Investors use this information for decision-making.
What is the significance of corporate earnings reports?	Corporate earnings reports provide details on a company’s financial performance, including revenue, profit, and future outlook. Investors closely analyze these reports to assess the company’s health.
How do dividends impact stock prices?	Dividends can positively impact stock prices as they are seen as a sign of a company’s profitability and financial strength. Investors often view dividend-paying stocks as stable and attractive investments.
How does the stock market perform during economic recessions?	Stock markets may experience declines during economic recessions due to reduced consumer spending, lower corporate profits, and overall economic uncertainty. However, market reactions can vary.
What is a Systematic Investment Plan (SIP)?	A Systematic Investment Plan (SIP) is an investment strategy where investors regularly contribute a fixed amount to a mutual fund, helping them benefit from rupee-cost averaging and disciplined investing.
How does the stock market accommodate foreign investors?	Foreign investors can invest in Indian stocks through the Foreign Institutional Investor (FII) and Foreign Portfolio Investor (FPI) routes, subject to regulatory guidelines and limits set by SEBI.
What is the role of technical analysis in stock trading?	Technical analysis involves studying historical price and volume data to make predictions about future price movements. Traders use charts, patterns, and technical indicators to inform their investment decisions.
What is the impact of global events on the Indian stock market?	Global events such as geopolitical tensions, economic crises, and changes in international trade policies can influence the Indian stock market, causing volatility and affecting investor sentiment.
What is a P/E ratio, and how is it used in stock analysis?	The Price-to-Earnings (P/E) ratio is a valuation metric calculated by dividing a company’s stock price by its earnings per share (EPS). It is used to assess the relative valuation of a stock in the market.
How can I safeguard my investments in a volatile market?	To safeguard investments in a volatile market, investors can diversify their portfolio, set stop-loss orders, stay informed about market trends, and focus on a long-term investment strategy.

IPO FAQs in the Indian Market

FAQs Table: IPOs in the Indian Market

Question	Answer
What is an IPO?	An Initial Public Offering (IPO) is the process through which a private company becomes publicly traded by offering its shares to the public.
How does an IPO work?	IPOs involve the issuance of new shares to the public, providing the company with capital for expansion or other purposes. Investors buy these shares on the stock exchange.
Why do companies go for an IPO?	Companies go public to raise capital, increase visibility, facilitate mergers/acquisitions, and provide liquidity to existing shareholders.
What are the benefits of investing in IPOs?	IPO investments offer the potential for capital appreciation, participation in a company’s growth, and the opportunity to benefit from listing gains.
How can I participate in an IPO?	Investors can participate in an IPO by submitting an application through their broker or using online platforms, adhering to the specified application process.
What is the difference between a mainboard IPO and a SME IPO?	Mainboard IPOs involve larger, well-established companies, while SME IPOs are for small and medium-sized enterprises seeking capital from the public.
What is a Red Herring Prospectus?	It is a preliminary prospectus issued before the IPO, providing details about the company, excluding the final issue price and the number of shares offered.
How is the IPO price determined?	The IPO price is determined through processes like book building, where investors bid within a price range, and the final price is set based on demand and supply.
Can retail investors apply for all IPOs?	Yes, retail investors can apply for most IPOs, subject to the specific conditions mentioned in the IPO’s offer document.
What is the role of underwriters in an IPO?	Underwriters guarantee the sale of IPO shares by purchasing them from the issuer and selling them to the public, managing the risk associated with the IPO.
What is a green shoe option?	Also known as an over-allotment option, it allows underwriters to sell additional shares if the demand is higher than expected during the IPO.
What is the lock-in period for promoters after an IPO?	Promoters are typically subject to a lock-in period, during which they cannot sell their allotted shares, ensuring stability and investor confidence.
How are IPO allotments made?	Allotments are made based on the bidding process, and shares are allocated to investors proportionally or through a lottery system, depending on the demand.
What is a book-building process in an IPO?	The book-building process is a price discovery mechanism where investors bid for shares within a specified price range, helping determine the final issue price.
What is the significance of the QIB category in an IPO?	Qualified Institutional Buyers (QIBs) are institutional investors, and their participation is crucial in gauging the overall demand and success of an IPO.
What is the difference between book-built and fixed-price IPOs?	In a book-built IPO, the price is determined through bidding, while in a fixed-price IPO, the price is pre-decided by the company.
How can I check the status of my IPO application?	Investors can check the IPO application status on the official website of the registrar or through their demat account and broker platforms.
Can I apply for an IPO using multiple demat accounts?	No, applying for an IPO using multiple demat accounts is not allowed. Each investor is limited to one bid per PAN card.
What is the role of a registrar and transfer agent in an IPO?	The registrar and transfer agent processes IPO applications, manages the allotment process, and maintains the share registry after the IPO.
What is the minimum and maximum bid lot in an IPO?	The bid lot refers to the minimum number of shares an investor can apply for. The minimum and maximum bid lots vary for each IPO and are specified in the offer document.
What is a pre-IPO placement?	A pre-IPO placement involves selling shares to institutional investors before the IPO, providing a measure of confidence in the company’s valuation.
How is the IPO market regulated in India?	The Securities and Exchange Board of India (SEBI) regulates the IPO market in India, ensuring transparency, fairness, and investor protection.
What is the grey market for IPOs?	The grey market is an unofficial market where IPO shares are bought and sold before the official listing, providing an indication of potential listing gains.
Can I sell IPO shares on the listing day?	Yes, investors can sell their IPO shares on the listing day once the shares are officially listed on the stock exchange.
What is the significance of anchor investors in an IPO?	Anchor investors are institutional investors who invest in an IPO before the public offering, providing stability and credibility to the issue.
Are there any tax implications for IPO investments?	Yes, capital gains tax may apply on the sale of IPO shares, and investors should be aware of the tax implications based on their holding period.
What happens if an IPO is undersubscribed?	If an IPO is undersubscribed, the company may choose to cancel the issue, and the entire application amount is refunded to the investors.
What is the role of SEBI in regulating IPOs?	The Securities and Exchange Board of India (SEBI) oversees the entire IPO process, ensuring compliance with regulations, protecting investors, and maintaining market integrity.
How are retail investors protected in an IPO?	SEBI has implemented various measures to protect retail investors, including defining minimum and maximum investment limits, ensuring a fair allotment process, and more.
What is the minimum and maximum investment limit for retail investors in an IPO?	The minimum and maximum investment limits for retail investors in an IPO are specified in the offer document and vary for each IPO.
Can I apply for an IPO using the UPI payment method?	Yes, the Unified Payments Interface (UPI) is a commonly accepted mode for making payments while applying for an IPO.
What is the significance of the IPO grading system?	The IPO grading system provides an assessment of the fundamentals of the IPO by credit rating agencies, helping investors gauge the risk associated with the issue.
What is the concept of cut-off price in an IPO?	Investors can bid at the cut-off price, indicating they are willing to purchase shares at any price within the price band, allowing for a simplified bidding process.
How can I calculate the market capitalization of a company post-IPO?	Market capitalization is calculated by multiplying the post-IPO share price by the total number of outstanding shares.
What is the difference between primary and secondary market offerings?	Primary market offerings involve the issuance of new shares, while secondary market offerings involve the sale of existing shares by current shareholders.
What is a buyback of shares post-IPO?	A buyback is when a company repurchases its own shares from the market, providing an exit route for investors and returning surplus cash to shareholders.
Can employees of the issuing company participate in the IPO?	Yes, employees are often given preferential treatment or reserved quotas to participate in the IPO, fostering employee ownership and loyalty.
What is the impact of market conditions on IPO subscription?	Market conditions, especially volatility, can impact IPO subscriptions. High market sentiment may lead to oversubscription, while bearish conditions may result in undersubscription.
How is the listing price of an IPO determined?	The listing price is determined based on the demand and supply dynamics on the listing day, and it may differ from the issue price.
What is the role of market makers post-IPO?	Market makers provide liquidity to the stock by continuously quoting buy and sell prices. Their role is crucial in maintaining a fair and orderly market post-IPO.
What is the difference between a listing date and a trading date?	The listing date is when the shares are officially listed on the stock exchange, while the trading date is when investors can start buying and selling the shares in the market.
How can I exit my investment in an IPO after the lock-in period?	After the lock-in period expires, investors can sell their shares in the secondary market through stock exchanges.
Can foreign investors participate in Indian IPOs?	Yes, foreign institutional investors (FIIs) and qualified foreign investors (QFIs) are allowed to participate in Indian IPOs, subject to regulatory guidelines.
What is the impact of IPOs on the stock market indices?	IPOs can influence stock market indices by adding new stocks, altering sector weights, and reflecting changes in market capitalization.
How does the process of IPO grading benefit investors?	IPO grading offers investors an independent assessment of the fundamentals of the IPO, aiding in making more informed investment decisions.
What is the concept of a follow-on public offering (FPO)?	An FPO is a subsequent public offering of shares by a listed company, allowing it to raise additional capital after the initial IPO.
How can I stay updated on upcoming IPOs in the Indian market?	Investors can stay informed about upcoming IPOs through financial news websites, stock exchange notifications, and updates from regulatory authorities like SEBI.

Disclaimer: The information provided in this blog is for general informational purposes only and should not be considered as professional advice. We are not registered with the Securities and Exchange Board of India (SEBI), and our content should not be construed as financial recommendations or endorsements. Readers are encouraged to conduct their own research and, if needed, consult with a certified financial advisor before making any investment decisions. We do not assume responsibility for any actions taken based on the information presented in this blog. Thank you for your understanding.