Kronox Lab (IPO)

IPO Coverage
Kronox Lab Sciences Limited

31 May 2024
Price Band Issue Size Issue Open Date Issue Close Date
₹ 129 – ₹ 136 ₹ 130.15 Cr 03 June 24 05 June 24
Promoters (Pre IPO) Promoters (Post IPO) Min Bid Lot Size Sector
100% 74.21% 110 Shares Chemical
Other Issue Details Objective of the Issue

• To achieve the benefits of listing the equity shares on the
Offer for Sale: stock exchanges.
(Amount)
₹ 130.15 Cr
• The company expects that the proposed listing of the
equity shares will enhance the visibility and brand image.
Face Value: ₹ 10/Share Tentative Schedule
Stages As on or Around date

Listing At: NSE, BSE
Finalisation of Basis of Allotment 06 June 2024
Refunds/Unblocking ASBA Fund 07 June 2024
Retail
Reservations
35.00% Credit of equity shares to DP A/c 07 June 2024
Listing Date 10 June 2024
Company Profile:
• Business : The company was incorporated in November 2008, manufactures high purity
specialty fine chemicals which are used in various applications such as manufacturing APIs,
pharmaceutical formulations, biotech application, agrochemical formulations, metal
refineries and animal health. The company offers a wide range of over 185 products.
• Network : The company has served more than 500+ customers in the past three years.
The company exports its products to countries such as Australia,
Argentina, Belgium, China, Egypt, Mexico, Turkey, UAE, USA etc. It also has three
manufacturing plants in Vadodara, Gujarat with installed capacity of 7,242 TPA.
Management - Experienced Promoters| Board & Senior Team | Marquee Investors
Jogindersingh Jaswal Ketan Ramani Samir Gadhiya Nikhil Goswami

Chairman & MD Director C.F.O. Company Secretary
IPO Coverage
Financial Snapshot
Financials (INR cr) Dec 31, 2023 (09) FY23 FY22 FY21
Equity Share Capital 37.10^ 37.10 0.24 0.24
Net worth 60.28 44.68 40.35 26.81
Revenue from ops. 67.69 95.58 82.25 62.46
EBITDA 20.46 21.99 19.70 14.80
EBITDA Margin (%) 30.23 23.01 23.95 23.70
Net Profit 15.47 16.62 13.63 9.73
EPS (Rs.) 4.17^ 4.30 3.49 2.40
Net Asset Value (Rs.) 16.25 12.04 10.34 6.87
RONW (%) 25.66 37.19 33.77 36.29
The company’s revenues remained upward and stood at Rs. 95.58 crore versus 82.25
Growth crore YoY and reported CAGR of 15.30 percent from FY21 to FY23.
In FY23, Company reported marginally lower EBITDA margin as EBITDA margins

Margins declined 94 basis points and stood at 23.01 percent versus 23.95 percent on YoY basis.
During FY23, Net Asset Value of the company reported 12.04 versus 10.34 in FY22.
Multiple RONW of the company Is also rising and recorded as 37.19% vs 33.77% YOY.
Company Products
• The company serves 185+ products in India and more than 20 other countries across the
world which includes products in the phosphate, sulphate, acetate, chloride, citrate,
nitrates, nitrites, carbonate, EDTA derivatives, hydroxide, succinate, and gluconate
families.
• The products are manufactured in compliance with industry standards such as IP, BP, EP,
JP, USP, FCC, LR, AR, GR, and ACS, as well as, in certain situations, customer-requested
special manufacturing specifications and has set up an in-house research, development
and testing laboratory to develop new products and test the products against the
specified industry standards or customer specifications.
• The company has launched the new products such as Glycinate, Succinate and Gluconate
to expand its portfolio through existing and proposed manufacturing facility.
IPO Coverage
SWOT Analysis
STRENGTH WEAKNESS
• Diversified product finding applications • The company will not receive any amount
in diversified end user market. from the proceeding from IPO as it is an offer
• Long standing relationship with customers for sale.
• Growing financials with zero debt and have • Business concentration has been seen
manufacturing facilities at strategic as top 10 customers are accounted
location. for around 52% of the total revenue.
Kronox
Lab
OPPORTUNITIES THREATS
• Focus towards import substitution with • Strong competitive pressure from
effective cost management. the listed industry peers.
• Expand production capacity and explore • Due to the nature of business, any deviation
new application for the existing products. in the product standard from the industry
• Enhance core probability for better standard and change in price of raw
performance. material may impact its performance.
Concluding Remarks
• Between FY 21 FY 23 the company reported an average EPS of Rs 3.40 and an average RoNW
of 35.75 percent If we attribute FY 24 annualized earnings, The issue is priced at a P/E of 24.46
with the consideration of its upper price band, Thus the issue appears reasonably priced.
• We recommend subscribing to this IPO with a medium- to long-term view and considering
a decent listing gain. The company operates in the high-purity specialty chemical segment. It
has a diversified product portfolio; the company enjoys a virtual monopoly on certain
products. There is room for geographical expansion, which will enhance its performance.
B-Wing, Siddhivinayak Towers,

Nr D.A.V School, Next to Kataria House, Off S.G. Highway, Makarba, Ahmedabad – 380051
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IPO Coverage

Kronox Lab Sciences Limited

100% 74.21% 110 Shares Chemical

Other Issue Details Objective of the Issue

Stages As on or Around date

Jogindersingh Jaswal Ketan Ramani Samir Gadhiya Nikhil Goswami

Equity Share Capital 37.10^ 37.10 0.24 0.24

Net worth 60.28 44.68 40.35 26.81

Revenue from ops. 67.69 95.58 82.25 62.46

EBITDA 20.46 21.99 19.70 14.80

EBITDA Margin (%) 30.23 23.01 23.95 23.70

Net Profit 15.47 16.62 13.63 9.73

EPS (Rs.) 4.17^ 4.30 3.49 2.40

Net Asset Value (Rs.) 16.25 12.04 10.34 6.87

RONW (%) 25.66 37.19 33.77 36.29

In FY23, Company reported marginally lower EBITDA margin as EBITDA margins

B-Wing, Siddhivinayak Towers,

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