Gujarat-based drug manufacturer Allchem Lifescience has filed preliminary papers with the Securities and Exchange Board of India (SEBI) to seek approval for its upcoming initial public offering (IPO). The IPO will comprise a fresh issue of equity shares worth INR 190 crore, along with an offer for sale (OFS) of 71.55 lakh equity shares by the company’s promoters, Kantilal Ramanlal Patel and Manisha Bipin Patel.
Utilization of Funds
Of the INR 190 crore fresh issue, INR 130 crore will be allocated towards debt repayment, while the remaining proceeds will be used for general corporate purposes and business expansion. The IPO is expected to help Allchem Lifescience strengthen its financial position and fuel future growth.
Company Overview and Business Operations
Established in 2017, Allchem Lifescience is a leading Indian manufacturer of active pharmaceutical ingredient (API) intermediates and specialty chemicals. The company specializes in key starting materials (KSMs) and API intermediates, including piperazine derivatives, which are essential for producing drugs like quetiapine, used in treating schizophrenia and bipolar disorder.
The company has developed an extensive portfolio of 263 products, highlighting its expertise in diverse organic chemical compounds. Allchem focuses on identifying high-demand products that are difficult to source in India, particularly import substitutes, and scaling up production to meet market needs.
Manufacturing and Clientele
Allchem operates a manufacturing facility in Vadodara, Gujarat, and caters to both domestic and international clients. The company serves 148 customers in India and 66 overseas, across 13 Indian states and 22 countries. Some of its notable clients include Alembic Pharmaceuticals, Bond Chemical, Indoco Remedies, Micro Labs, MSN Laboratories, Nagase India, Neogen Chemicals, Neuland Laboratories, and Unichem Laboratories (NSE:UNLB).
Financial Performance
Allchem Lifescience has demonstrated strong financial growth, with its revenue from operations increasing at a compound annual growth rate (CAGR) of 12.7% between FY22 and FY24. The company’s revenue for the six months ending September 30, 2024, stood at INR 7.84 crore.
Profit after tax (PAT) has grown at an impressive CAGR of 28.6% from March 31, 2022, to March 31, 2024. For the six-month period ending September 2024, the PAT was recorded at INR 1.09 crore, indicating robust profitability.
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