Overview of Citichem India IPO
Citichem India Limited is launching its IPO as a fixed price issue worth ₹12.60 crores, comprising a fresh issue of 18.00 lakh shares. The issue price is set at ₹70 per share, and the IPO will open for subscription on December 27, 2024, and close on December 31, 2024.

The company will allocate shares to applicants on January 1, 2025, with a tentative listing date of January 3, 2025, on the BSE SME platform.

IPO Investment Details
The IPO requires a minimum application of 2,000 shares per lot, translating to:

• Retail investors: ₹1,40,000 per lot
• HNIs (2 lots): ₹2,80,000 for 4,000 shares

Horizon Management Private Limited serves as the book-running lead manager, and Kfin Technologies Limited is the registrar for the IPO. Aftertrade Broking Pvt Ltd is the market maker.

Business Profile of Citichem India Limited
Incorporated in 1992, Citichem India Limited specializes in the supply of organic and inorganic chemicals, bulk drugs, and food chemicals to the pharmaceutical and allied industries.

The company’s product portfolio is vast, including specialty chemicals, bulk drugs, intermediates, and food chemicals that serve industries such as:

• Pharmaceuticals
• Textiles
• Steel and aluminum
• Paints and dyes
• Food and dairy

Citichem India is also involved in the sourcing, make-to-order outsourcing, and retail distribution of these products. Some of its popular products include Caustic Soda Flakes, Citric Acid Monohydrate, and Hydrogen Peroxide.

The company has three primary business divisions:

1. Specialty Chemicals, Intermediates, and APIs: It caters to domestic and international clients with customized chemical solutions.
2. Food Chemicals: Citichem handles retail distribution and repackaging under its proprietary brand.
3. Laboratory Chemicals: It provides a one-stop solution for laboratory chemical needs.

With a team of only 9 employees (as of June 30, 2024), the company operates efficiently while leveraging a scalable business model.

Competitive Strengths
Citichem India’s competitive edge lies in:

1. Experienced promoters and management with deep industry knowledge.
2. Scalable business model capable of adapting to industry demands.
3. A focus on quality and innovation, ensuring customer satisfaction.
4. Strategic location advantage, facilitating faster supply chain operations.
5. Strong relationships with suppliers and customers, bolstered by an effective after-sales network.

Objectives of the IPO
The proceeds from the IPO will be used to:

1. Enhance working capital for day-to-day operations.
2. Invest in expanding the specialty chemicals and food chemicals divisions.
3. Fund general corporate purposes.

Why Invest in Citichem India IPO?

1. Growth Potential: The company operates in high-demand sectors like specialty chemicals and pharmaceuticals.
2. Attractive Pricing: At ₹70 per share, the IPO is reasonably priced for a niche BSE SME listing.
3. Steady Revenue Model: Its diverse product range ensures stability across economic cycles.

IPO Risks and Considerations

1. Small Workforce: Managing operations with just 9 employees may pose scalability challenges.
2. Competitive Industry: The specialty chemicals sector faces competition from large players with established brands.
3. SME Volatility: SME stocks are prone to high volatility, making them less suitable for risk-averse investors.

Conclusion
Citichem India IPO offers an opportunity to invest in a niche player in the specialty chemicals and pharmaceutical supply chain. While the company boasts strong fundamentals and a scalable model, investors should carefully consider the risks associated with SME investments. Retail investors and HNIs should evaluate their risk appetite before subscribing to this IPO.

The Current active IPO is Unimech Aerospace, Ventive Hospitality, Senores Pharmaceuticals, Carraro India.

The Closed IPOs are  Transrail Lighting, Mamata Machinery, DAM Capital, Sanathan Textiles, Concord Enviro, Newmalayan Steel, Identical Brain Studios and NACDAC Infrastructure.