Sigachi Industries Limited IPO; GMP, Issue Price, Issue Size

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Sigachi Industries Limited IPO
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Sigachi Industries is in the manufacturing of Microcrystalline Cellulose (MCC) which is widely used as an excipient for finished dosages in the pharmaceutical industry is all set to make a debut on the stock market with an issue size of ₹125.43 Cr.    

Sigachi Industries Limited IPO-Overview     

Sigachi Industries Limited Issue Date     1-3 November 2021    
Sigachi Industries Limited IPO Opening Date     1 November 2021    
Sigachi Industries Limited IPO Face Value     INR 10 per share     
Sigachi Industries Limited IPO Price     INR 163 per share    
Sigachi Industries Limited IPO Lot Size     90 Shares    
Issue Size     125.43 Cr    
Issue Type     Book built Issue IPO     
Listing At     BSE, NSE    
Company Promoters     Evergraph Holdings Pte. Ltd. and K.A. Joseph. are the company promoters.   
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Sigachi Industries Limited IPO- Tentative Dates     

Sigachi Industries Limited IPO opening date     1 November 2021      
Sigachi Industries Limited IPO closing date     3 November 2021    
Basis of Allotment     10 November 2021    
Initiation of Refunds     11 November 2021    
The credit of Shares to Demat  12 November 2021    
Sigachi Industries Limited IPO Listing Date     15 November 2021    

Sigachi Industries Limited Industry Overview     

Microcrystalline has refined wood pulp and chemically inert substance, extensively used in food, pharmaceuticals, cosmetics, and polymer composite industries.  This is owing to its non-toxicity, renewability, biodegradability, and mechanical properties such as high surface area and biocompatibility. In processed food products, it is used as an emulsifier, stabilizer, anti-caking agent, texture modifier, stabilizer, fat substitute, and suspending agent.  

The MCC market is projected to grow from USD  938 million in 2019 to USD 1,315 million by 2024, at a CAGR of 7.0% between 22019 and 2024.  The growth of the MCC market is primarily triggered by the increasing demand for processed food and the growing production of pharmaceutical and cosmetic & personal care products.  

Sigachi Industries Limited IPO

Sigachi Industries Limited Company Overview     

The company was incorporated as a private limited company in 1989, with the business of manufacturing chlorinated paraffin and hydrochloric acid in the manufacturing unit situated in Hyderabad.  In the year 1990the Company diversified its product portfolio to manufacture microcrystalline cellulose (―MCC‖). The Company commenced its export operations in the year 1996 by exporting its first order of MCC to Bangkok. Owing to the consistent efforts of the Company, the sales from the export operations constituted 32% of the total sales during the financial year ending March 31, 2004.  In the year 2000, to diversify the business activities, the Company started manufacturing premium-grade microcrystalline cellulose by successfully commissioning a spray drier and a multi-fuel furnace, which in turn also increased the manufacturing capacity from 720 metric Tonnes per annum to 1080 metric tones per annum. Presently, they manufacture 50 different grades of MCC at the manufacturing units, situated in Hyderabad and Gujarat with an aggregate installed capacity of 11,880MTPY.  With over 30 years of continuous growth, three multi-location manufacturing facilities, and a consistent focus on delivering a superior quality product, the Company is one of the leading manufacturers of cellulose-based cellulose-based excipients in India, in terms of volume.  

Sigachi Industries Limited IPO-Objectives     

  • Funding capital expenditure:  

          i)for expansion of production capacity for MCC at Dahej, Gujarat 28.15 crores. 

          ii)for expansion of production capacity for MCC at Jhagadia, Gujarat 29.24 crores. 

          iii)funding capital expenditure to manufacture CCS at the Proposed Unit of 32.29 crores. 

  •  General corporate purposes. 

Sigachi Industries Limited Financial Statements     

Summary of financial Information (Restated Consolidated) in millions   

Particulars    30-Jun-21   31-Mar-21   31-Mar-20   31-Mar-19   
Total Assets    1,514.19  1,155.59  1,334.07  1,091.43  
Total Revenue    551.22  448.16  1,960.10  1,439.49  
Profit After Tax    89.89  60.59  302.60  203.15  

Sigachi Industries Limited IPO Strengths    

  • One of the leading manufacturers of MCC in India.  
  • Long-standing market presence in Pan India and Internationally.  
  • The comprehensive product portfolio allows it to have diverse end-use applications.  
  • Wide product portfolio and ability to serve diverse end-use applications.  
  • Long-term relationships with customers in diverse industry verticals  
  • Investments and a strong focus on R&D.  
  • Quality assurance and quality control in products and facilities.  
  • Strategically located, multi-locational manufacturing facilities.   

Sigachi Industries Limited IPO Weakness     

  • Dependance on the demand from the pharmaceutical industry for revenue.  
  • The global scope of operations exposes the company to the risks of doing business in foreign countries.  

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