ResGen Limited IPO

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i. ResGen Limite is engaged in the process of manufacturing Pyrolysis Oil (a substitute for furnace oil) from all kinds of waste plastics. They call this: PlasEco. During the manufacturing of PlasEco, they’re able to repurpose the by-products generated, such as Carbon, which substitutes for coal; and Gas, which substitutes for LPG. The company has set up a Chemical Recycling Plant in Vikramgad (Palghar), Maharashtra, considering it’s proximity to the Municipal Corporations of Mumbai, Thane, Kalyan & Dombivli.

ii. ResGen, has come up with an ingenious method, which is not only ecofriendly but also gives by-products which are very essential to one and all. The major by-product being combustible liquid and gaseous fuel, it can replace the diesel or furnace oils, which will directly reduce the need and impact of our combustible fuel resources. The company use a patented catalytic process to improve the efficiency, safety and scalability of the pyrolysis process

iii. Company’s Product

i. Pyrolysis Oil: Pyrolysis oil, sometimes also known as bio-crude or bio-oil, is a synthetic fuel under investigation as a substitute for petroleum. The pyrolysis oil is a mixture of various compositions from c4 to c20 carbon chains. It has properties similar to a mixture of petrol, kerosene and diesel.

Major Use of Pyrolysis Oil
i. Direct combustion
ii. Refined into diesel oil
iii. Can be used as a feedstock for producing virgin polymers

Benefits of Pyrolysis
i. Recycles end-of-life Plastic Waste. Plastic waste which cannot be segregated, or cannot be recycled can be used in this process.
ii. Produces fuel with high calorific value for commercial purpose.
iii. Prevents Environmental and/or Health Hazards caused by plastic waste.
iv. Leads to Cleaner Surroundings, a meaningful contribution to Swachh Bharat Abhiyan.

iv. Competitive Strengths

i. Strategic Location of Manufacturing Unit
ii. Quality Assurance
iii. Well-defined organizational structure
iv. Strong professional and execution team allows the Company to develop a strong business.

 

Objects of the ResGen Limited IPO:

The Company intends to utilize the Net Fresh Issue Proceeds for the following Objects: i. Working Capital Requirements ii. Purchase of the land where the Manufacturing facility is currently situated iii. General Corporate Purposes.  
DRHP of ResGen Limited IPO

ResGen Limited IPO Details:

Open Date: Feb 28 2023
Close Date: Mar 02 2023
Total Shares: 6,000,000
Face Value: ₹ 10 Per Equity Share
Issue Type: Book Built Issue IPO
Issue Size: 28.20 Cr.
Lot Size: 3000 Shares
Issue Price: ₹ 45-47 Per Equity Share
Listing At: BSE SME
Listing Date: Mar 13 2023

Promoters And Management:

i. Mr. Karan Atul Bora, aged 29 years, has Degree in Bachelor of Engineering in Civil and Environmental Engineering from Cardiff University, Wales, United Kingdom, completed in the year 2015. He is the Founder and one of the First Director of the Company, later he was designated as the Managing Director of the Company with effect from November 10, 2022 till November 09, 2027 for a period 5 years. He has around 6 years of experience across sectors in Operations, Finance, Project Management and Business Development. He is an Innovative thinker with Broad Based Expertise. He has proven ability to quickly analyse key business drivers and develop strategies to grow the bottomline. He is a high integrity energetic leader known for ability to envision and create successful outcomes in complex situations. ii. Mr. Abhijeet Oza Ashok, aged 34 years, He is holding a Degree in Masters of Business Administration from Savitribai Phule Pune University, Pune in the year 2016. He was appointed as an Executive Director with effect from September 29, 2018. He was associated with Safilo Group as Area Sales Executive for a period of 3 years. iii. Mr. Milind Rane, aged 48 is the Non-Executive Director of the Company. He was appointed as Additional Director with effect from June 30, 2022 and was further regularised as a Non-Executive Director with effect from June 30, 2022.  

Financials of ResGen Limited IPO:

Particulars ( In Lakhs ) 8MFY23 2022 2021 2020
Revenue from Operations 1265 480 2 -
Other Income - - - -
Total Revenue 1265 480 2 -
Cost of Materials Consumed 464 247 - -
Purchase of Stock-in-Trade 470 28 - -
Changes in inventories -352 -30 - -
Employee Benefits Expense - - - 0.83
Other Expenses 49 34 1 14
EBITDA 634 201 0.66 -15
Depreciation & Amortisation 193 66 - -
Finance Cost 96 30 0.03 -
EBIT 440 134 0.66 -15
OPM (%) 50.11% 41.86% 33.00% 0.00%
PBT 344 104 0.63 -15
Taxes 97 30 - -
PAT 246 73 0.63 -15
NPM (%) 19.48% 15.29% 31.50% 0.00%
No.of Shares 209 209 209 209
EPS 1.17 0.35 0.003 -0.07
P/E 40.00 134.12 15648.01 -650.70
 

Comparison With Peers:

There are no listed companies which are engaged in the similar business.

Recommendation on ResGen Limited IPO:

Review and Recommendation of ResGen SME IPO by IZ team is 2/10 1. RESGEN Limited is engaged in the process of manufacturing Pyrolysis Oil (a substitute for furnace oil) from all kinds of waste plastics. It's called PlasEco. PlasEco may use byproducts like Carbon, which replaces coal, and Gas, which replaces LPG. 2. The company established a Chemical Recycling Facility in Vikramgad (Palghar), Maharashtra, near Mumbai, Thane, Kalyan, and Dombivli Municipal Corporations. 3. ResGen has invented an eco-friendly technology that produces vital byproducts. The main byproduct, combustible liquid and gaseous fuel, can substitute diesel or furnace oils, reducing their requirement and impact. A unique catalytic technique improves pyrolysis efficiency, safety, and scalability. 4. Major Pyrolysis Oil Uses:- i) Direct combustion ii) Refined into diesel oil iii) Can be used as a feedstock for producing virgin polymer 5. Competitive Strengths :- a) They have successfully decoded the formula for Pyrolysis. b) Strategic Location of Manufacturing Unit. c) Quality Assurance d) Well-defined organisational structure. e) Strong professional and execution team allows the Company to develop a strong business f) Existing Supplier Relationship. g) Progressive Employer. 6. Their industry is well-positioned, informed, and trained to deliver exceptional products on schedule. Industry growth and government initiatives are causing competition. They believe product features, design, quality, price, delivery, customer experience, speed to market, after-sale and logistical assistance, and manufacturer-customer ties drive competition in their sector. 7. The Revenue has Increased from Rs.0 in FY20 to Rs 4 Crore in FY22. 8. The EBITDA has Increased from (-15) Lakhs in FY20 to 2 Crore in FY22. 9. The PAT has Increased from (-15) Lakhs in FY20 to 73 Lakhs in FY22. 10. As per FY22, CFO/EBITDA is (-0.67) and Debtors Days is 212. 11. As per FY23, EPS is 1.80,  Market Capitalization is 98 Crore & P/E is 26x.

Lead Manager of ResGen Limited IPO:

  1. Gretex Corporate Services Private Limited

Registrar of ResGen Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

ResGen Limited 919, Floor 9th, Plot-221, Maker Chamber. V. Jamnalal Bajaj Marg, Nariman Point, Mumbai- 400021 Phone: 022-22810181 Email: info@resgen.in Website: http://www.resgen.in/

Discussion on ResGen Limited IPO:

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