JG Chemicals IPO Allotment Status

Highlights of the JG Chemicals Ltd

The stock of JG Chemicals Ltd has a face value of ₹10 per share and the book building price band was fixed between ₹210 and ₹221 per share. The JG Chemicals IPO will be a combination of a fresh issue of shares and offer for sale (OFS) component. As you would be aware, a fresh issue tends to bring in fresh funds into the company, but is also EPS and equity dilutive. On the other hand, OFS is just a transfer of ownership. The fresh issue portion of the IPO of JG Chemicals Ltd comprises the issue of 74,66,063 shares (74.66 lakh shares approximately), which at the upper price band of ₹221 per share will translate into a fresh issue size of ₹165.00 crore. The offer for sale (OFS) portion of the IPO of JG Chemicals Ltd comprises the sale / offer of 39,00,000 shares (39.00 lakh shares), which at the upper price band of ₹221 per share will translate into an OFS size of ₹86.19 crore. 

Out of the OFS size of 39 lakh shares, the entire shares will be offered by the promoter group. This will include the sale of 20.29 lakh shares by Vision Projects and Finvest Private Ltd, 12.60 lakh shares by Suresh Kumar Jhunjhunwala, 6.10 lakh shares by Anirudh Jhunjhunwala and a small quantity by Jayant Commercial Ltd. Thus, the total IPO of JG Chemicals Ltd will comprise of a fresh issue and an OFS of 1,13,66,063 shares (113.66 lakh shares approximately) which at the upper end of the price band of ₹221 per share aggregates to total issue size of ₹251.19 crore. However, the eventual size of the IPO would be subject to minor changes due to adjustments in the size of allocation. The IPO of JG Chemicals Ltd will be listed on the NSE and the BSE on the IPO mainboard.

The fresh funds will be used to invest in its materials subsidiary, BDJ Oxides for funding capex and for repayment of its loans. Part of the fresh funds will also be used for long term working capital. Promoters currently hold 100% in the company, which will get diluted post the IPO to 70.99%. The IPO will be lead managed by Centrum Capital, Emkay Global and Keynote Financial Services, while KFIN Technologies Ltd will be the IPO registrar.

How to check allotment status of the IPO?

Allotment status online is an internet facility that is provided by the BSE (formerly Bombay Stock Exchange) and by the registrars on their website. Many of the brokers also provide direct connectivity to the database. However, in the absence of any connectivity, one option you always have is to use one of these options. That means; you can either check your allotment status on the BSE website or the IPO registrar, KFIN Technologies Limited (formerly Karvy Computershare). Here are the steps.

Checking the allotment status of JG Chemicals Ltd on BSE website

This is a facility available to all mainboard IPOs, irrespective of who the registrar to the issue is. To access the allotment status on BSE India; click on the IPO allotment link below.

https://www.bseindia.com/investors/appli_check.aspx 

Once you reach the page, here are the steps to follow.
    • Under Issue Type – Select Equity Option
    • Under Issue Name – Select JG Chemicals Ltd from the drop down box
    • Enter the Application Number exactly as in the acknowledgement slip
    • Enter the PAN (10-digit alphanumeric) number
    • Once this is done, you need to click on the Captcha to verify that you are not a robot
    • Finally click on the Search Button

In the past, while checking the allotment status on the BSE website, it was necessary to input the PAN number and the application Number. However, now BSE has modified the requirements and it is sufficient if you enter any one of these parameters. There is one more point to note. Even if the company appears in the dropdown, the allotment status will only be available for you to check after the basis of allotment is finalized. So, the company will be available in the drop down just around 11th March 2024.

To complete your checking process, once you click on the SUBMIT button, the allotment status will be displayed on the screen in front of you informing about the number of shares of JG Chemicals Ltd allotted into your demat account. You can save a screenshot for future reference and for reconciling with the demat credit on 12th March 2024

Checking the allotment status on KFIN Technologies Ltd (Registrar to IPO)

Visit the website of KFIN Technologies Ltd, which has been appointed as the registrar for the issue. You can access their website for IPO status by clicking on the link below:

https://ris.kfintech.com/ipostatus/

There are three things to remember. Firstly, you can just click on the hyper link given above and directly go to the allotment checking page. The second option, in case you are not able to click on the link, is to copy the link and paste in your web browser. Thirdly, there is also a way to access this page via the home page of KFINTECH India Ltd but that pathway is slightly more complex as the website is designed more as a B2B website, so you can avoid that.
Here you are given the choice to select 5 servers viz. Link 1, Link 2, Link 3, Link 4, and Link 5. There is nothing to be confused, as these are just server backups in case one of the servers is experiencing too much traffic. You can select any of these 5 servers and in case you are facing problems accessing one of the servers, then try the other one. There is no difference, which server you select, the output will still be the same.

A small point to remember here. Unlike on the BSE website, where the names of all IPOs are there on the drop-down menu, the registrar will only provide list of the IPOs managed by them and where the allotment status is already finalized. Also, for simplicity, you can either choose to see all IPOs or just recent IPOs. Choose the latter, as that reduces the length of the list of IPOs you need to search through. Once you click on Recent IPOs, the dropdown will only show the recent active IPOs, so once the allotment status is finalized, you can select JG Chemicals Ltd from the drop-down box. That means; you can access allotment status of JG Chemicals Ltd either late on 11th March 2024 or by the middle of 12th March 2024.

• There are 3 options. You can either query the allotment status based on PAN, Application Number or Demat Account (DPID-Client ID combination).

• To Query by PAN, check the appropriate box and follow these steps.
        ◦ Enter the 10-digit PAN number
        ◦ Enter the 6-digit Captcha Code
        ◦ Click on Submit button
        ◦ Allotment status gets displayed on screen

• To Query by Application Number, check the appropriate box and follow these steps.
        ◦ Enter the Application Number as it is
        ◦ Enter the 6-digit Captcha Code
        ◦ Click on Submit button
        ◦ Allotment Status gets displayed on screen

In the past, the first step was to select Application Type (ASBA or Non-ASBA) before inputting your application number. Now, that step has been done away with.

• To Query by Demat Account, check the appropriate box and follow these steps.
        ◦ Select the depository (NSDL / CDSL)
        ◦ Enter the DP-ID (Alphanumeric for NSDL and Numeric for CDSL)
        ◦ Enter the Client-ID
        ◦ In the case of NSDL, the Demat account is 2 strings
        ◦ In the case of CDSL, the Demat account is just 1 string
        ◦ Enter the 6-digit Captcha Code
        ◦ Click on Submit button
        ◦ Allotment Status gets displayed on screen

It is always advisable to retain a saved screenshot of the allotment status output for future reference. The same can be tallied with the demat account credit subsequently, when the status is updated in your demat account by end of 12th March 2024 bearing the ISIN Number code (INE0MB501011)

What determines the chances of allotment in the IPO?

Broadly, there are 2 factors that determine the chances of an investor in getting an IPO. The first is the number of shares available under each of the categories, depending on which category you choose to invest in. The table below captures the quota for each of the categories as decided by the company in consultation with the BRLMs.

Data Source: BSE

In the above table, the anchor portion allotment is already completed a day ahead of the IPO. The subscription for the QIB category above is only for the residual amount, not absorbed by anchors. We now move to the second item that influences allotment and that is the subscription ratio. Here is what the ratio of subscription for each category looks like.

Data Source: BSE

As can be seen, greater the oversubscription, lower the chances of allotment. The reverse also holds true. However, one thing to note is that SEBI rules for retail allocation are designed in such a way that maximum number of retail investors get at least the minimum 1 lot allotment. So, applying in the names of all your family members can improve your chances of allotment. In the above case, the oversubscription of the retail portion is quite modest while that of the HNI portion is at a relatively higher level. Hence, the chances of allotment are relatively good for retail, but relatively lower for the HNI / NII category. However, it is always best to await the final answer once the basis of allotment is finalized, and then check the status online based on the modus operandi explained above.

Next Steps in the JG Chemicals Ltd IPO

The issue opened for subscription on 05th March 2024 and closed for subscription on Thursday, 07th March 2024 (both days inclusive). The basis of allotment will only be finalized on Monday after three holidays. The basis of allotment will be finalized on 11th March 2024 and the refunds will be initiated on 12th March 2024. In addition, the demat credits are expected to also happen on 12th March 2024 and the stock will list on 13th March 2024 on the NSE and the BSE. JG Chemicals Ltd will test the appetite for such specialty chemical plays in India. The credits to the demat account to the extent of shares allotted will happen by the close of 12th March 2024 under ISIN (INE0MB501011).

Investors would do well to remember that the level of subscription is very material as it determines the chances of getting allotment. Normally, higher the subscription ratio, lower the chances of allotment and vice versa. In this case, the subscription levels have been modest to strong in the IPO; both in the Retail segment and also in the HNI / NII segment. Investors in the IPO need to assess their chances of allotment accordingly. The final status will be known once the basis of allotment is finalized and uploaded for you to check. You can apply the above allotment checking process flow after the basis of allotment is finalized.