Crop Life Science IPO Final Subscription Status

The IPO of Crop Life Science Ltd closed on Tuesday, 22nd August 2023. The IPO had opened for subscription on 18th August 2023. Let us look at the final subscription status of Crop Life Science Ltd at the close of subscription on 22nd August 2023. It was a fixed price IPO and the issue price had already been fixed at ₹52 per share with stock having face value of ₹10.

About the Crop Life Science IPO

Crop Life Science IPO worth ₹26.73 crore comprises entirely of a fresh issue with no offer for sale (OFS) component. The Fresh Issue portion of Crop Life Science Ltd entails the issue of 51.40 lakh shares, which at the fixed price of the IPO at ₹52 per share aggregates to ₹26.73 crore. The stock has a face value of ₹10 and retail bidders can bid in minimum lot size of 2,000 share each. Thus, the minimum investment of ₹104,000 in the IPO is the base limit. That is also the maximum that a retail investor can apply for in the IPO.

HNIs / NIIs can invest in a minimum of 2 lots of 4,000 shares worth ₹208,000 as the bare minimum investment. There is no upper limit for the HNI / NII category or even for the QIB category. Crop Life Science Ltd will deploy the funds for working capital needs and for general corporate purposes. Post the IPO, the promoter equity in the company will get diluted from 100.00% to 70.01%. The issue is lead managed by Interactive Financial Services Ltd, while Purva Share Registry India Private Ltd will be the registrars to the issue. Let us now turn to the final subscription details of the IPO as of the close of subscription on 22nd August 2023.

Final subscription status of Crop Life Science IPO

Here is the subscription status of the Crop Life Science IPO as at close on 22nd August 2023.

The issue was open for retail investors, HNI / NIIs, apart from a portion allocated to the market makers to the issue. There was a broad quota designed for each of the segments viz. the retail and the HNI / NII. The table below captures the allocation reservation done for each of the categories out of the total number of shares offered in the IPO. A total of 2,60,000 shares were allocated as market maker portion to Nikunj Stock Broker Ltd, which will act as a market maker inventory to provide bid-ask liquidity on the counter post listing. Market maker actions not only improves liquidity in the counter but also reduces the basis spreads in the stock, and hence the risk of trading in the stocks too.

As can be seen, from the above table, there is no anchor quota allocated in the IPO and hence no anchor placement was done the day prior to the IPO. Even there was dedicated QIB quota in the IPO and any interested QIBs could invest as part of the non-retail category, which includes the HNI / NII investors predominantly.

How subscription built up for the Crop Life Science IPO

The oversubscription of the IPO was dominated by the HNI / NIIs followed by the retail investors and the QIB investors in that order. The table below captures the day-wise progression of the subscription status of Crop Life Science IPO.

It is clear from the above table that while the retail portion got fully subscribed on the first day of the IPO itself, the QIB portion got fully subscribed only on the last day of the IPO and even after the bunched response on the last day of the IPO, the HNI / NII portion left a lot to be desired. However, the overall IPO was fully subscribed on the second day itself although most of the traction was seen on the last day. Both the categories of investors viz., HNIs / NIIs and retail categories saw reasonably moderate traction and build-up of interest on the last day of the IPO; although it was the retail investors who saved the blushes to the issue. There is an allocation of 2,60,000 shares to Nikunj Stock Brokers Ltd for market making. The market maker offers two way quotes on the stock post listing using the inventory of shares and ensures that investors do not get overly worried about liquidity and basis risk in the early stages.

The IPO of Crop Life Science Ltd opened for subscription on 18th August 2023 and closed for subscription on 22nd August 2023 (both days inclusive). The basis of allotment will be finalized on 25th August 2023 and the refunds will be initiated on 28th August 2023. In addition, the demat credits are expected to happen on 29th August 2023 and the stock is scheduled to list on 30th August 2023 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated.

A quick word on Crop Life Science Ltd and the SME IPO

Crop  Life Science Ltd, is an SME IPO on the NSE which opened for subscription on 18th August 2023. The company, Crop  Life Science Ltd, was incorporated in the year 2006. The company is engaged in the business of manufacturing, distributing, and marketing agrochemical formulations. Here is a quick word about its specific products. Crop Life Science Ltd manufactures agricultural chemicals like micro fertilizers and pesticides which includes Insecticides, fungicides, herbicides, and weedicides. It has a manufacturing plant that is located at the GIDC (Gujarat Industrial Development Corporation) Ankleshwar in the state of Gujarat. The facility spans a total area of 5,831 SQM. Crop Life Science Ltd exports its manufactured products to other countries like Indonesia, Bangladesh, Egypt, Myanmar, Vietnam, and Sudan among others. Its product portfolio comprises more than 85 agrochemical products.

Apart from its main business, Crop Life Sciences also has two group companies. CLSL Pack Science Private Ltd into the manufacturing of induction sealing wads and other flexible packaging products. It has just about started generating revenues in FY22 and it is still making losses on a net basis. The other group company of Crop Life Sciences Ltd is Hetban Spechen Ltd. It has a modern and multipurpose plant to manufacture various technical grades of insecticides, fungicides, herbicides, and PGR and is located at Dahej in Gujarat. This group company still does not have any revenues of its own as its factory has been leased to Crop Life Sciences Ltd.