PETRO CARBON AND CHEMICALS IPO Review

Petro Carbon and Chemicals Limited (“PCCL”) is a ATHA Group (the “Group”) Company engaged in the business of manufacturing and marketing of Calcined Petroleum Coke (“CPC”) in the carbon industry. PCCL’s business model is fundamentally a B2B model wherein they majorly supply theur end product CPC, to the renowned, aluminum manufacturing government companies, graphite electrodes and titanium dioxide manufacturers as well as other users in the metallurgical, chemical industries and other steel manufacturing companies.

The Company is backed by strong and professional Promters named, Mr. KISHOR KUMAR ATHA, who has a vast experience of around seven decades, have been able to consistently maintain the growth projections over the years.

Financially, PCCL revenue increased from ₹15,528.68 Lakhs in FY21 to ₹27,992.70 Lakhs in FY22 and further increased to ₹51,760.99 Lakhs in FY23 and currently at ₹44,711.11 Lakhs for 9MFY24. Similarly, EBITDA increased from ₹284.82 Lakhs in FY21 to ₹1,205.43 Lakhs in FY22 and further increased in FY23 at ₹1,622.68 Lakhs and currently at ₹10,548.82 Lakhs for 9MFY24. The PAT increased from ₹11.64 Lakhs in FY21 to ₹570.99 Lakhs in FY22 and further showing growth at ₹672.20 Lakhs in FY23 and currently jumped at ₹7,031.16 Lakhs for 9MFY24. This indicates a steady growth in financial performance.

For the PCCL IPO, the company is issuing shares at a pre-issue EPS of ₹2.59 and a post-issue EPS of ₹2.14. The P/E ratio is 66.02x on FY23 basis but only 6.21x on 9MFY24 basis against the industry P/E ratio of 11.30x. The company's ROCE for 9MFY24 is 60.36%, and ROE for 9MFY24 is 46.88%. These metrics suggest that the IPO is fairly priced.

The Grey Market Premium (GMP) of Petro Carbon and Chemicals Limited indicates potential listing gains of 60% - 70%. Given the company's financial performance and the valuation of the IPO, we recommend Investors to apply to the IPO for listing gains or long term Investment purposes.