The Gem Aromatics IPO has attracted significant attention in the primary market as the issue closed with an overall subscription of 2.58 times on the final day, August 21, 2025. With its strong fundamentals, established track record, and leadership in specialty ingredients, essential oils, and aroma chemicals, the company has successfully generated investor confidence ahead of its proposed listing on the BSE and NSE.

The IPO of Gem Aromatics Limited is a Book Built Issue amounting to ₹451.25 Crores, which includes a Fresh Issue of 0.53 Crore shares worth ₹175 Crores and an Offer for Sale (OFS) of 0.85 Crore shares amounting to ₹276.25 Crores. The subscription window was open between August 19 and August 21, 2025, with the basis of allotment expected to be finalized on Friday, August 22, 2025, and the listing tentatively scheduled on Tuesday, August 26, 2025.

The IPO price band has been fixed at ₹309 to ₹325 per equity share, with a lot size of 46 shares. For retail investors, the minimum investment required was ₹14,950, while High-Net-Worth Individuals (HNIs) were required to invest in a minimum of 14 lots (644 shares), amounting to ₹2,09,300. At the upper end of the price band, the market capitalisation of Gem Aromatics stands at approximately ₹1,697.70 Crores.

The issue has been managed by Motilal Oswal Investment Advisors Limited as the Book Running Lead Manager, while KFin Technologies Limited is acting as the Registrar to the issue.

Grey Market Premium (GMP) Update

As per the latest updates, the Gem Aromatics IPO Grey Market Premium (GMP) is recorded at ₹33, indicating an expected listing price of around ₹358 per share, translating to a potential 10.15% premium over the issue price. However, it is important to note that the GMP is an unofficial indicator of demand and supply in the unregulated grey market and is only considered for educational and informational purposes.

Anchor Investors Participation

Prior to opening for the public subscription, Gem Aromatics successfully raised ₹135.37 Crores from Anchor Investors at the upper price band of ₹325 per share. The company allotted 41,65,383 equity shares to the Anchor Investors in consultation with the Book Running Lead Managers. It is worth noting that the allocation to Anchor Investors is carved out of the Qualified Institutional Buyers (QIBs) portion.

Day-Wise IPO GMP Trend

The GMP trend ahead of the listing date has remained consistent at ₹33, showcasing investor optimism about potential listing gains. On 14 August 2025, the GMP was reported at the same level, reflecting steady interest from the grey market participants.

IPO Objectives

The proceeds from the Fresh Issue are expected to be utilised towards two primary objectives:

1. Prepayment or repayment of borrowings: Around ₹1,400 Million will be used for repayment of certain outstanding loans availed by the company and its subsidiary, Krystal Ingredients Private Limited.

2. General corporate purposes: The balance amount will be deployed for strengthening working capital requirements and other corporate needs.

Financial Performance of Gem Aromatics

Gem Aromatics has shown consistent financial growth over the last three years. The company reported Revenue from Operations of ₹5,056.40 Million in FY25, compared to ₹4,542.25 Million in FY24 and ₹4,250.93 Million in FY23. Similarly, the EBITDA rose to ₹901.39 Million in FY25, against ₹801.27 Million in FY24 and ₹664.86 Million in FY23.

The Profit After Tax (PAT) stood at ₹533.84 Million in FY25, up from ₹501.04 Million in FY24 and ₹446.72 Million in FY23, highlighting a steady upward trajectory.

On valuation terms, the company has reported a pre-issue EPS of ₹11.39 and post-issue EPS of ₹10.22 for FY24. The pre-issue P/E ratio is 28.53x, while the post-issue P/E ratio stands at 31.80x, against the industry P/E of 112x. Furthermore, the company’s ROCE is 16.02%, ROE is 18.80%, and RoNW is 18.80%, making the IPO appear reasonably priced compared to industry peers.

Promoters and Leadership

The company is promoted by Vipul Parekh, Kaksha Vipul Parekh, and Yash Vipul Parekh, who have over two decades of expertise in the specialty ingredients industry. Their vision and leadership have been instrumental in helping Gem Aromatics secure a strong position in the domestic and global markets.

Investor Sentiment and Review

Market analysts believe that the Gem Aromatics IPO has been fairly priced, given its financial track record and industry position. With a steady growth in revenue and profitability, the issue offers reasonable confidence to investors. The Grey Market Premium (GMP) of ₹33 suggests moderate listing gains of over 10%, making it attractive for those seeking short-term returns. However, considering the valuation levels and industry competition, experts have recommended the IPO primarily for risk-tolerant investors who are looking for listing gains rather than long-term holding.

Key Takeaways for Investors

• The Gem Aromatics IPO has seen robust demand, subscribing 2.58 times overall on the closing day.

• The price band is set at ₹309-₹325, and the GMP at ₹33 points towards likely listing gains.

• The allotment date is August 22, 2025, and the shares are expected to list on August 26, 2025.

• Strong financials and a well-diversified product portfolio make Gem Aromatics a noteworthy player in the essential oils and aroma chemicals industry.

In conclusion, the Gem Aromatics IPO subscription status, GMP trends, allotment updates, and financial review indicate strong investor interest backed by stable growth and a promising outlook. While long-term prospects depend on market competition and global demand trends, the IPO provides an opportunity for investors who are looking to benefit from potential short-term listing gains.

The Upcoming IPOs in this week and coming weeks are Anlon Healthcare, NIS Management, Sattva Engineering Construction, Globtier Infotech, Current Infraprojects, Anondita Medicare, Classic Electrodes (India), Vikran Engineering, Shivashrit Foods.

The Current active IPO are ARC Insulation & Insulators, Mangal Electrical Industries, LGT Business Connextions, Vikram Solar, Gem Aromatics, Shreeji Shipping Global, Patel Retail.

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