Nova Agritech Limited IPO

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i. We are an agri-input manufacturer offering soil health management, crop nutrition and crop protection products focused on tech-based farmer driven solution approach, wherein the mainly offer ecologically sustainable and nutritionally balanced products based on the R&D. They manufacture, distribute and market a wide range of product categories consisting of

(a) soil health management products;
(b) crop nutrition products;
(c) bio stimulant products;
(d) bio pesticide products
(e) Integrated Pest Management (IPM) products;
(f) new technologies; and
(g) crop protection products.

ii. Currently, the crop protection products are manufactured by their subsidiary Nova Agri Sciences Private Limited.

iii. They have received a total of 629 product registrations comprising of 7 registrations in the soil health management category, 168 registrations in the crop nutrition category, 4 registrations in bio pesticide category and 450 registrations in the crop protection category.

iv. The company’s dealer network is currently spread across 16 states of India namely Andhra Pradesh, Telangana, Maharashtra, Karnataka, Madhya Pradesh, Rajasthan, Chhattisgarh, Tamil Nadu, Uttar Pradesh, Odisha, West Bengal, Bihar, Gujarat, Jharkhand, Uttarakhand and Jammu & Kashmir and 02 in Nepal.

Competitive Strengths

i. One stop solution for soil health management, crop nutrition, bio stimulant, bio pesticides, Integrated Pest Management (IPM) and crop protection through diversified branded product portfolio
ii. Established distribution network across various geographies through many dealers.
iii. Strengthening farmer outreach through Nova Kisan Seva Kendra.

Objects of the Nova Agritech Limited IPO:

The net proceeds of the Fresh Offer, i.e. gross proceeds of the Fresh Offer less the offer expenses apportioned to the Company (“Net Proceeds”) are proposed to be utilised in the following manner: a. Investment in the subsidiary, Nova Agri Sciences Private Limited for setting-up a new formulation plant; b. Funding Capital Expenditure in the Company, towards expansion of the existing formulation plant; c. Funding of working capital requirements of the Company; d. Investment in the subsidiary, Nova Agri Sciences Private Limited, for funding working capital requirements; and e. General corporate purposes.
DRHP of Nova Agritech Limited IPO
RHP of Nova Agritech Limited IPO

Nova Agritech Limited IPO Details:

Open Date: Jan 23 2024
Close Date: Jan 25 2024
Total Shares: 35,075,693
Face Value: ₹ 2 Per Equity Share
Issue Size: 143.81 Cr.
Lot Size: 365 Shares
Issue Price: ₹ 39 - 41 Per Equity Share
Listing At: NSE,BSE
Listing Date: Jan 31 2024

Promoters And Management:

i. Adabala Seshagiri Rao is a Chairperson and Independent Director of the Company. He holds Degree of Bachelor of Science and Degree of Bachelor of Laws from the Andhra University. He holds diploma in Industrial Relations & Personnel Management and Diploma in Marketing & Sales Management from the Bharatiya Vidya Bhavan. He is a Certified Associate of Indian Institute of Bankers (CAIIB Retail Banking examination from the Institute of Banking & Finance. He has over 34 years of experience in the banking industry. His last employment before retirement was with the Union Bank of India. ii. Malathi S is one of the Promoter and Executive Director of the Company. She has completed her Bachelor of Commerce from Kakatiya University. She has been associated with the Company since 2011 and oversees the operations of the Company iii. Kiran Kumar Atukuri is one of the Promoter and Managing Director of the Company. He has completed his Bachelor of Science in Agriculture from Acharya N. G. Ranga Agricultural University and Master of Business Administration from Nagarjuna University. He has almost two decades of experience in the field of Sales & Marketing, Product Development, Channel Management, Key Account Management and Client Relationship Management in Agricultural inputs Business. He has worked with Rasi Seeds (P Ltd., Maharashtra Hybrid Seeds Co. Ltd., ICICI Bank, Monsanto, Syngenta and EID Parry. He is the guiding force behind all the corporate decisions and is responsible for the entire business operations specifically manufacturing and sales operations of the Company.

Financials of Nova Agritech Limited IPO:

Particulars ( In Lakhs )
2021
2022
2023
6M-FY24
Revenue from Operations 16,064 18,559 21,056 10,322
Other Income 28 2 38 3
Total Revenue 16,093 18,561 21,093 10,324
Cost of Materials consumed 9,856 12,212 11,994 6,547
Changes in inventories 49 -863 140 -627
Employees Benefit Expenses 2,210 2,647 2,731 1,227
Other Expenses 2,164 1,784 2,319 1,239
EBITDA 1,815 2,782 3,910 1,938
Depreciation & Amortisation 215 223 236 100
Finance costs 733 715 857 435
EBIT 1,600 2,560 3,674 1,838
OPM (%) 11.28% 14.99% 18.54% 18.77%
PBT 867 1844 2816 1403
Tax 237 475.5 767 365
PAT 630 1369 2049 1038
NPM (%) 3.91% 7.38% 9.71% 10.06%
No.of Shares 925.19 925.19 925.19 925.19
EPS 0.68 1.47 2.21 1.12

Comparison With Peers:

Name of the Company Revenue (In Crore) PAT (In Crore) EPS ( in Rs) P/E CMP Mcap (In Crore)
Nova Agritech Limited 211 20 2.21 18.5 41 379
Aries Agro Ltd 472 16 13.17 21.6 206 268
Aimco Pesticides Limited 206 -2 -2.10 N/A 122 117
Basant Agrotech Limited 565 18 2.03 30.3 22.6 205
Best Agrolife Limited 1,746 192 81.27 9.5 832 1,968
Bhagiradha Chemicals & Industries Ltd 502 46 44.60 51.2 1,491 1,557
Heranba Industries Limited 1,324 110 27.52 24.6 386 1,545
India Pesticides Limited 885 144 12.55 43.2 380 4,365
Madras Fertilizers Limited 3,447 185 11.50 26.8 112 1,807
Dharmaj Crop Guard Limited 527 33 9.80 20.2 264 895
* All the data is as per FY23.

Recommendation on Nova Agritech Limited IPO:

Review and Recommendation on Nova AgriTech IPO by IZ team is 5/10

Lead Manager of Nova Agritech Limited IPO:

  1. Keynote Corporate Services Limited

Registrar of Nova Agritech Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

Sy.No.251/A/1, Singannaguda Village, Mulugu Mandal, Siddipet, Medak, Telangana – 502279 Phone: +91 84 54253446 Email: ipo@novaagri.in Website: https://novaagri.in/

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