K.P.R. Agrochem Limited IPO
(i) K.P.R. Agrochem Limited is an agri-input Company focused on manufacturing, distribution and retailing of a wide range of crop yield-enhancing and protection products.
(ii) The company product portfolio includes Crop protection, Crop nutrients, seeds, and Veterinary feed supplements. Further, in order to secure supply of sulphuric acid, one of the key ingredients, they also ventured into manufacturing of sulphuric acid. They produce sulphuric acid as well as other sulphuric acid-based chemicals like LABSA, DMS, and Oleum that have wider applications across industries like agrochemicals, veterinary feed supplements, pharmaceuticals, synthetic detergents etc.
(iii) Majority of the sales is from branded products like “FAST” (application has been made for trademark registration), “MOTOX – 10G” (trademark registered), “SAMRAT ATRAZINE 50% WP” (application has been made for trademark registration) and “MEGA IMIDA” (application has been made for trademark registration) brands for crop protection; “AJAY (14-35-14)” (trademark registered) and “AJAY (20-20-0)” (trademark registered) for NPK mixture crop nutrient products; “ANNADATA SINGLE SUPER PHOSPHATE” for single super phosphate; “ABHAYA CAL MIX” (trademark registered) for di-calcium phosphate and “APURVA SEEDS” (application has been made for trademark registration) for seeds.
(iv) To ensure timely supply and availability of the products as well as achieve last mile connectivity with the farmers, they have set-up Company operated depots at 11 locations across India that are established based on the agricultural belts and/or having ease of connectivity with our dealer network. They have also appointed C & F Agents in 8 locations. The products are distributed from the depots/manufacturing location based warehouses/ C & F Agents to a network of approximately 8,000 dealers spread across various states in India.
(v) Further, the company has also set-up a chain of company-operated retail outlets known as Kisan Seva Kendras in the East and West Godavari, Vizianagaram, Srikakulam, Visakhapatnam and Krishna districts of Andhra Pradesh; Warangal district of Telangana; and Koppal, Raichur, Bellary and Gadag districts of Karnataka where our primary manufacturing operations are conducted as a channel of direct sales to our end customers.
Objects of the K.P.R. Agrochem Limited IPO:
K.P.R. Agrochem Limited IPO Details:
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Book Building|
|Issue Size:||283.2 Cr.|
|Lot Size:||200 Shares|
|Issue Price:||₹ 59-61 Per Equity Share|
Promoters And Management:
Financials of K.P.R. Agrochem Limited IPO:
Comparison With Peers:
|Company||Revenue||Revenue Growth in 3 years||OPM||PAT||PAT Growth in 3 years||NPM|
|Insecticides India Limited||1076||4.25%||14.2%||84.00||46%||8%|
|Aarti Industries Limited||5016||25.89%||19.4%||498.00||23.83%||10%|
|Company||Long-term debt||Short-term debt||Net-worth||EPS||P/E||Mcap||RONW||Credit cycle|
|KPR Agro||61||234||252||3.01||20||731||7.90%||154 days|
|Coromandel Int||0||2937||3358||25||16.4||11996||21%||50 days|
|Chambal Fertilisers||4414||4279||2883||14||12.35714||7239||20.5%||171 days|
|Deepak Fertilizers||1770||1175||2097||8||15.625||1109||4%||74 days|
|Insecticides India||8||96||547||41||15.02439||1273||15%||79 Days|
|Dhanuka Agritech||0||22||642||23||16.73913||1817||17%||77 Days|
|Aarti Industries Limited||844||1290||2762||59||29.9322||15306||0.180304||58 days|
Recommendation on K.P.R. Agrochem Limited IPO:
Lead Manager of K.P.R. Agrochem Limited IPO:
Registrar of K.P.R. Agrochem Limited IPO:
Discussion on K.P.R. Agrochem Limited IPO:
The Rs 283.20 Cr proposed public issue of KPR Agro has been withdrawn for unknown reasons. The IPO was planned to open on June 28, 2019
avoid this ipo
what is the gmp
So,what is your opinion about this ipo,do i invest or not
will inform by tomorrow.
A lot of Litigation against the company( KPR Agrochemicals)
4. As per the business network model, they supply the products to the dealers/distributors without taking full payment or security deposit against the orders placed by them. So if distributors don’t make a payment on time or not pay at all the performance of the company may affect seriously.
They have close to 281 crores of receivables against the revenue of 447 Cr in the first 9MFY19 which is a cause of concern.
Risk in the business.
1. The company’s growth depends upon Agriculture Sector. Agriculture in turns depends on Monsoon. So a good monsoon is a prerequisite for the company’s performance.
2. The company’s business requires very high working capital. The receivable collection cycle is relatively long which makes business susceptible to market downturns and client credit risk.
Due to high credit cycle and high requirement of working capital, the company needs to borrow funds to run the business of the company.
The average collection period for Fiscal 2017, Fiscal 2016 and Fiscal 2015 are 154 days, 161 days and 158 days respectively on a consolidated restated basis.
3. Some of the Promoters have provided personal guarantees as collateral for a significant portion of borrowings made by some of their Group Entities.
One of the Group Entities, K.P.R. Industries (India) Limited have received notices, between April 1, 2017, to September 22, 2017, from lenders namely (collectively the “Banks”) for defaulting in repayment of loans granted by the Banks. The banks have already classified a loan of 380 Cr given to them as NPA.
If any of these Group Entities default on its repayment obligations, the guarantees extended by such promoters may be invoked and such lenders may require such promoters to discharge the balance liability of such Group Entity, if any, and the lenders may recover the dues from personal assets of such promoters, including shares held by such promoters in the KPR Agrochem Limited which will affect the company badly.
Let us understand the business of the company:
1. Crop Protection Products
They manufacture a wide variety of pesticides intended for preventing, repelling and mitigating any pest infesting various type of agricultural produce including paddy, cotton, sugar cane, pulses, vegetables, etc.
The crop protection products include insecticides, antibiotics, bactericides, herbicides, fungicides, micronutrients, organic manure and bioproducts for protecting the crop from pests, weeds, diseases, etc.
2. CROP NUTRIENTS
Crop nutrient products (fertilizers) enhance the natural fertility of the soil by replenishing the chemical elements taken from the soil by harvesting, grazing, leaching or erosion.
Under this category, the Company primarily manufactures NPK mixtures (N – Nitrogen; P – phosphorus, and K – potassium), Single Super Phosphate (SSP), micronutrients and bioproducts.
3. Sulphuric Acid
Sulphuric acid is a major raw material in the phosphate fertilizer industry and one of the largest-volume industrial chemicals produced in the world with large-scale industrial uses.
They manufacture Sulphuric Acid from their own plants at Biccavolu in Andhra Pradesh and Koppal in Karnataka. Sulphuric Acid produced is used for captive consumption and for industrial supply.
4. Veterinary Supply
The company is also manufacturing veterinary feed supplements Dicalcium phosphate, which is one of the most popular types of the veterinary feed supplement used in feed grade of animals.
They manufacture DCP in their manufacturing facilities at Biccavolu in East Godavari district of Andhra Pradesh and in Koppal district, Karnataka and sells under the brand name “ABHAYA.
Under a wholly owned subsidiary of the Company, they develop, produce, process and sell seeds across a variety of field crop and vegetable crops.
The major crop seeds are paddy, maize, BT cotton, sunflower, wheat, mustard, sorghum-sudangrass, grams in field crops and okra, chilies, tomato, brinjal, watermelon, gourds, cole crops, and leafy vegetables in the vegetable crops.
Business Contribution from different products.
1. NPK Mixtures = 28.15% [ Crop Nutrients ]
2. DCP Animal Feed = 26.03% [ Veterinary Feed ]
3. Pesticides= 16.30% [ Crop Protection ]
4. Others = 30%
Looks like a decent offer, particularly if one looks at the govt leaning to push farmer income
Not good IPO
Around 210 cr
KPR Agrochem gets SEBI’s go ahead for the ipo around Rs.210 crore. The company is a manufacturer, distributor and retailer of wide range of crop yield enhancing and protection products. The product range includes crop protection, crop nutrients, seeds, feed supplements, veterinary and more.
Dates mentioned are tentative.
Size n PB…Apx?
Will u have any whatsup group for share market related news
Yes. If you’re interested, send your name, email ID and phone number to our email ID firstname.lastname@example.org
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