Specialty chemical company Safex Chemicals has filed draft papers with SEBI for its initial public offering (IPO).
Safex Chemicals India Ltd, a company operating in the specialty chemicals sector, has taken a new step in its preparations to enter the stock market. The company has filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for its initial public offering, i.e., IPO.
What will be the structure of the IPO?
This IPO of Safex Chemicals will come in the form of a fresh issue of ₹450 crore. In addition, under the Offer for Sale (OFS), promoters, investors and existing shareholders will sell a total of 35,734,818 equity shares. That is, investors will get an opportunity to buy fresh shares of the company as well as the stake of the old shareholders.
Use of funds raised from the IPO
The money raised by the company through the IPO will be used for debt repayment, general corporate purposes, and future expansion plans. The company intends to strengthen its balance sheet further and clarify the path to growth with this fund.
Pre-placement plan before the IPO as well
Safex Chemicals is also planning to make a pre-IPO placement of up to ₹90 crore. If this placement is successful, the size of the fresh issue will be reduced in the same proportion. This step indicates that the company wants to maintain flexibility while keeping in mind the market conditions.
Who are the major investors in the company?
Private equity firm ChrysCapital also has a large investment in the company. In March 2021 and September 2022, this firm took a significant stake in the company. Currently, ChrysCapital owns a 44.80 percent stake in the company.
Business model of Safex Chemicals
Established in 1991, the company operates in three major segments:
- Branded Formulations
- Specialty Chemicals
- Contract Development and Manufacturing Organization (CDMO)
The main objective of the company is to provide farmers with advanced products for crop protection. This will increase their yield and protect crops from diseases.
Journey of important acquisitions
Safex Chemicals has made several major acquisitions in recent years, including -
- Acquisition of Shogun Lifesciences in July 2021
- Purchased Shogun Organics in September 2021
- Acquired Briar Chemicals of the UK in October 2022
These acquisitions have not only increased the company's production capacity but also strengthened its foothold in international markets.
Where is the company present?
As of March 31, 2025, Safex Chemicals has a presence in 22 countries. It has 7 manufacturing units in India and one unit in the United Kingdom.
Strength seen in revenue
In the financial year 2024-25, the company's revenue increased by 12.83 percent to reach ₹1,584.78 crore, which was ₹1,404.59 crore in the previous financial year. These figures show the company's b growth and the increasing demand in the formulations segment.
Key managers of the IPO
Axis Capital, JM Financial and SBI Capital Markets will act as the book running lead managers for this IPO. In addition, the company has proposed to list its equity shares on NSE and BSE.
