Neptune Petrochemicals Limited is engaged in the manufacturing and trading of a comprehensive range of bitumen products, including various grades of bitumen, bitumen emulsions, Polymer Modified Bitumen (PMB), Crumb Rubber based modified bitumen, and oils. These products cater to a wide range of industries, primarily focusing on construction and industrial applications.

The company has announced a Book Built Issue IPO of ₹ 73.2 Crores, consisting entirely of a fresh issue of 60 lakh equity shares. The IPO opens for subscription on May 28, 2025, and closes on May 30, 2025. The shares are proposed to be listed on the BSE SME platform with a tentative listing date of June 4, 2025.

The IPO price band is fixed between ₹ 115 and ₹ 122 per equity share. The company’s market capitalization at the upper price band of ₹ 122 per share will stand at approximately ₹ 276.37 Crores. The minimum lot size for retail investors is 1,000 shares, requiring an investment of ₹ 1,22,000 at the upper band, while High-Net-Worth Individuals (HNIs) must apply for a minimum of two lots (2,000 shares), amounting to ₹ 2,44,000.

BEELINE CAPITAL ADVISORS PRIVATE LIMITED is the book running lead manager for this issue, while MUFG Intime India Private Limited acts as the registrar. The market maker for the IPO is Spread X Securities Private Limited.

The Grey Market Premium (GMP) for Neptune Petrochemicals IPO is currently expected to be ₹ 0, indicating no premium listing gains expected based on current demand and company financials.

As of May 29, 2025, the IPO subscription stands at 1.67 times on the second day of the subscription period, showing moderate investor interest.

The company has secured ₹ 20.84 Crores from anchor investors who have been allocated 17,09,000 equity shares at the upper price band of ₹ 122 per share. These anchor allocations come from the Qualified Institutional Buyers (QIB) portion.

IPO Objectives

The company intends to deploy the net proceeds raised through the IPO for:

1. Funding capital expenditure for additional plant and machinery and related infrastructure (₹ 5.15 Crores).

2. Purchasing office space (₹ 14.75 Crores).

3. Meeting working capital requirements (₹ 42 Crores).

4. General corporate purposes.

Financial Performance Overview

The company has shown a steady financial growth over the last few years:

• Revenue from operations was ₹ 62,016.47 Lakhs for the nine months ended December 31, 2024, and ₹ 67,596.79 Lakhs and ₹ 70,930.85 Lakhs for FY 2024 and 2023 respectively.

• EBITDA stood at ₹ 2,665.04 Lakhs for the nine months ended December 2024, compared to ₹ 2,867.83 Lakhs for FY 2024.

• Profit after Tax (PAT) was ₹ 1,946.59 Lakhs for the nine months ended December 2024 and ₹ 2,081.56 Lakhs for FY 2024.

Key Ratios

• Pre-issue EPS: ₹ 13.87 (FY24), Post-issue EPS: ₹ 9.19.

• Pre-issue P/E ratio: 8.80x, Post-issue P/E ratio: 13.28x versus industry average P/E of 18x.

• Return on Capital Employed (ROCE): 117.86% (FY24).

• Return on Equity (ROE): 96.85%.

• Return on Net Worth (RoNW): 65.25%.

These metrics suggest the IPO is fairly priced, with strong profitability and returns but limited listing gain potential.

IPO Review & Recommendation

Neptune Petrochemicals has an experienced management team led by Managing Director Mr. Pareshkumar Subodhchandra Shah and Whole-Time Director Mr. Sanjaykumar Subodhchandra Shah, bringing 20 and 15 years of industry experience respectively.

The product range caters to critical infrastructure and industrial segments, giving it a steady demand outlook. However, with a Grey Market Premium at zero, listing gains may be limited. Investors looking for immediate listing profits may want to avoid this IPO, while those focusing on long-term business fundamentals might consider participation cautiously.

Disclaimer: This IPO review is for educational purposes and does not constitute financial advice. Potential investors should consult financial advisors and consider their risk tolerance before investing.

The Upcoming IPOs in this week and coming weeks are 3B Films, Victory Electric Vehicles International, Wagons Learning.

The Current active IPO are N R Vandana Tex Industries, Scoda Tubes, Neptune Petrochemicals, Blue Water Logistics, Astonea Labs, Nikita Papers, Prostarm Info Systems.

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