Arunaya Organics Limited, engaged in trading and manufacturing dyes and intermediates, has announced its Initial Public Offering (IPO) with a total issue size of ₹ 33.99 Crores. The IPO consists of a fresh issue of 52.6 Lakh shares worth ₹ 30.50 Crores and an offer for sale of 6.00 Lakh shares totaling ₹ 3.48 Crores.

The IPO will open for subscription on April 29, 2025, and close on May 02, 2025. The allotment of shares will be finalized around May 05, 2025, with a tentative listing date set for May 07, 2025, on the NSE SME platform.

Price Band and Lot Size
The price band for the Arunaya Organics IPO has been set between ₹ 55 and ₹ 58 per equity share. At the upper price of ₹ 58 per share, the company’s market capitalization will be ₹ 101.72 Crores. The lot size is 2,000 shares, requiring a minimum investment of ₹ 1,16,000 for retail investors. High-net-worth individuals (HNIs) must apply for a minimum of 4,000 shares, translating to an investment of ₹ 2,32,000.

Subscription & GMP Details
As of 11:00 AM on April 29, 2025, the Arunaya Organics IPO has been subscribed 0.11 times on its first day of subscription. The Grey Market Premium (GMP) for this IPO is currently ₹ 0, indicating no significant premium being observed in the grey market. It’s important to note that trading in the grey market is not a reliable indicator of the final listing price, as the price discovery process occurs post-listing on the stock exchange.

Allotment Process
Investors can check the Arunaya Organics IPO allotment status on May 05, 2025, by visiting the registrar’s website. The allotment process will be done based on the investor’s application number, PAN, or DP Client ID.

Objectives of the IPO
The funds raised from the IPO will be utilized for the following purposes:

1. ₹ 1,178.95 Lakh for setting up a new manufacturing facility in Dahej, Gujarat, under a proposed Greenfield Project.

2. ₹ 900.00 Lakh for funding the company's working capital requirements.

3. The remaining funds will be allocated for general corporate purposes.

Company Overview and Financials
Arunaya Organics is primarily involved in trading and manufacturing dyes, including reactive, acid, direct, basic, and solvent dyes. Their offerings also include dye intermediates and specialty performance chemicals for industries like paper and textile dyeing. The company’s financials show steady growth in revenues and profits over the past few years. The revenues for FY 2024 were ₹ 5,820.52 Lakh, and the company reported a profit after tax (PAT) of ₹ 359.78 Lakh for the period ending December 31, 2024.

The company’s pre-issue EPS stands at ₹ 3.95, and the post-issue EPS is expected to be ₹ 2.31 for FY 24. The pre-issue price-to-earnings (P/E) ratio is 14.68x, while the post-issue P/E ratio is 25.07x. The industry P/E ratio is much higher at 77x, suggesting that the IPO is fairly priced compared to industry standards. Arunaya Organics’ Return on Capital Employed (ROCE) for FY 2024 is 36.27%, while the Return on Equity (ROE) stands at 44.15%, indicating a solid track record of generating returns.

IPO Review
Based on Arunaya Organics’ financial performance, industry positioning, and valuation, the IPO appears reasonably priced with a fairly low P/E ratio compared to industry peers. However, the Grey Market Premium (GMP) has shown no movement, and the overall market sentiment should be considered before investing for listing gains. Given the current financial metrics, we recommend avoiding the IPO for listing gains as there is no significant premium or high demand observed in the grey market.

This IPO provides a reasonable entry for those looking to invest long-term, especially with a strong focus on expanding its manufacturing capabilities and increasing working capital. However, those seeking immediate gains through listing might find this offering less attractive at this stage.

Conclusion
Investors should carefully evaluate Arunaya Organics’ IPO based on their investment horizon and risk appetite. The company’s growth prospects, coupled with its strategic initiatives, make it a potentially stable investment, but short-term investors might want to consider the grey market’s current stagnation before deciding.

In conclusion, the Arunaya Organics IPO is best suited for long-term investors looking for growth in the dyes and intermediates industry, with an emphasis on its planned expansions.

The Upcoming IPOs in this week and coming weeks are  Wagons Learning, Srigee DLM, Manoj Jewellers.

The Current active IPO are Kenrik Industries,Arunaya Organics, Ather Energy, Iware Supplychain Services.

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