GSP Crop Science, an agrochemical company based in Gujarat submitted IPO papers to the Securities and Exchange Board of India (SEBI) on 20 December 2024. The company is aiming to raise capital through a mix of fresh equity and an offer for sale by promoters. Equirus Capital and Motilal Oswal are the book-running lead managers to the issue.
GSP Crop Science IPO Structure and Financial Details
The public issue comprises:
- Fresh Issue: INR 280 crore
- Offer for Sale (OFS): 60,00,000 equity shares
GSP Crop Science has also indicated the possibility of conducting a pre-IPO placement to raise INR 56 crore. If this occurs, the amount raised will be deducted from the fresh issue component. The funds from the fresh issue are primarily earmarked for repaying INR 200 crore of existing debt, with the remainder allocated for general corporate purposes. The company currently carries an outstanding debt of INR 428.3 crore, including INR 288.96 crore in fund-based borrowings.
Promoters and Competition: The promoters of GSP Crop Science hold 98.25% equity in the company, with the rest, just 1.75%, in the hands of public shareholders. This makes GSP a heavyweight in the agrochemical space, playing in the same league as PI Industries and Sumitomo Chemical India.
GSP Crop Science – Business Overview
GSP Crop Science is an established research-driven agrochemical company in India, with nearly four decades of experience since its inception in 1985. Specializing in the development and production of insecticides, herbicides, fungicides, and plant growth regulators, the company is focused on providing effective crop protection solutions that boost agricultural productivity. As of September 2024, GSP Crop Science has registered 507 agrochemical products, holds 89 patents with another 98 applications pending, and has generated significant revenue from its patented products.
Notable for its innovative Formulations, including combinations like Pendimethalin with Metribuzin for wheat and Pyraclostrobin with Clothianidin for groundnut, the company has established itself as a leader in introducing new agrochemicals to the Indian market. Their subsidiary, Rajdhani Petrochemicals, has also been recognized for its high volume of patent filings, showcasing GSP’s commitment to R&D and its pivotal role in advancing agrochemical technology.
IPO Proceeds
- Debt Repayment: The company is looking to knock down INR 200 crore of debt load.
- Corporate Purposes: Up to 25% of the capital raise will be used for corporate stuff.
Market Ambitions
With all their focus on research and a broad product line, GSP Crop Science is ready for a bigger share of the agrochemical landscape. This IPO isn’t just about raising funds; it’s about setting the stage for financial stability and expansion. In essence, GSP Crop Science stepping up with their IPO is a bold move in their saga. GSP is looking to clean up the balance sheet, grow its footprint, and keep innovating.
As of November 2024, the Indian primary market has seen a total of 76 IPOs. Out of this, 58 listings have achieved positive performance. However, there were challenges as well, with 18 IPOs experiencing negative returns. Notably, the average listing day return stands at an impressive 27.47%, underscoring the potential for significant gains in this dynamic market. For more information related to IPO GMP, SEBI IPO Approval, and Live Subscription stay tuned to IPO Central.
