ALLCHEM LIFESCIENCE LIMITED FILES DRHP WITH SEBI

Allchem Lifescience Limited, an Indian manufacturer of active pharmaceutical ingredients (API) intermediates and speciality chemicals, has filed its Draft Red Herring Prospectus (“DRHP”) with market regulator Securities and Exchange Board of India (“SEBI”).

The IPO comprises of a fresh issue of equity shares of face value of ₹10 each aggregating up to ₹ 190 Crores and an offer for sale of up to 7,155,000 equity shares of face value of ₹ 10 each. The offer for sale comprises of up to 3,577,500 equity shares of face value of ₹ 10 each by Kantilal Ramanlal Patel and up to 3,577,500 equity shares of face value of ₹ 10 each by Manisha Bipin Patel (Promoter Selling Shareholder).

Allchem Lifescience Limited proposes to utilise from the Net Proceeds an estimated amount of ₹ 130 Crores towards full or partial repayment or pre-payment of certain borrowings availed by the Company as well as towards general corporate purposes and to fulfill the business requirements of the Company.

Incorporated in 2017, Allchem Lifescience Limited is an Indian manufacturer of active pharmaceutical ingredients (API) intermediates and speciality chemicals. The company specializes in the production of key starting materials (KSMs), generic API intermediates and specialty chemicals. The company is a key player in manufacturing piperazine derivatives, which are critical raw materials for producing APIs like Quetiapine. The company has a reaction volume of 1,134 KL as of December 2024 and a hydrogenation capacity of 60 KL, making it one of the largest in India, according to the CARE report.

Over the years, Allchem Lifescience has developed the ability to manufacture 263 products which demonstrates their strong focus on different chemistries in organic chemical compounds. The Company’s focus has been to identify potential demand for products, in particular, products that are difficult to source in India or which being import substitutes are not easily available, develop such products and scale up production once the demand is in place. The diversity of the product bouquet enables them to address a wide range of industrial applications including pharmaceutical, agro chemicals, veterinary, plastics and electrochemical.  

Allchem Lifescience caters to prominent domestic and international customers, such as Alembic Pharmaceuticals Limited, Bond Chemical Limited, Chemosyntha BV, Cohance Life Sciences Limited, Egene Co Limited, Hattori Corporation, Huaian Jiamu Biotechnology Co. Limited, Indoco Remedies Limited, Megafine Pharma (P) Limited, Micro Labs Limited, Moehs Iberica, S.L., MSN Laboratories Private Limited, Nagase India Private Limited, Neogen Chemicals Limited, Neuland Laboratories Limited, Olon Active Pharmaceutical Ingredients India Private Limited, Unichem Laboratories Limited, Vasudha Pharma Chem Limited and Vivatis Pharma GmbH. As of December 31, 2024, they serve customers across 13 states in India and 22 countries overseas. As of FY24, they have 148 customers in India and 66 customers overseas.

The company’s manufacturing facility is in Manjusar, Vadodara, Gujarat. As on December 31, 2024, the Manufacturing Facility had a total equipment capacity of 1,133.50 KL.

The company has demonstrated consistent growth in the financial performance across parameters. The revenue from operations has grown at a CAGR of 12.75% between FY22 and FY24. The revenue from operations during the 6 month period ended September 30, 2024, and during FY24, FY23 and FY22, was ₹ 784.48 million, ₹ 1,374.21 million, ₹ 1,057.19 million and ₹ 1,081.01 million Further, the profit after tax (PAT) has grown at a CAGR of 28.65% from March 31, 2022 to March 31, 2024. The profit after tax for 6 month period ended September 30, 2024, and for FY24, FY23 and FY22, was ₹ 108.91 million, ₹ 234.09 million, ₹ 179.89 million and ₹ 141.39 million, respectively.

Emkay Global Financial Services Limited is the sole Book Running Lead Managers to the issue.