Source: SEBI
The specialty chemicals manufacturer’s initial public offering is now live for subscription, targeting to raise ₹451.25 crores with listing scheduled for August 26, 2025
The specialty chemicals manufacturer’s initial public offering (IPO) was open for subscription from August 19 to August 21, 2025. The Mumbai-based company targeted to raise ₹451.25 crores with listing scheduled for August 26, 2025.
Gem Aromatics Limited, a leading manufacturer of specialty ingredients including essential oils and aroma chemicals, offered shares in the price band of ₹309 to ₹325 per equity share.
IPO Structure and Key Details
The ₹451.25 crore IPO comprises both fresh issue of shares and an offer for sale (OFS) component. Each equity share carries a face value of ₹2, with retail investors required to apply for a minimum of one lot containing 46 shares, translating to a minimum investment of ₹14,950 at the lower price band.
Key IPO Parameters:
- Issue Size: ₹451.25 crores
- Price Band: ₹309-325 per share
- Face Value: ₹2 per share
- Lot Size: 46 shares
- Minimum Investment: ₹14,950 (retail)
- Subscription Period: August 19-21, 2025
- Allotment Date: August 22, 2025
- Listing Date: August 26, 2025
- Exchanges: BSE and NSE
Reservation Structure
The IPO follows the standard reservation pattern with 35% allocated to retail individual investors, 50% reserved for qualified institutional buyers (QIB), and 15% for high net worth individuals (HNI).
Company Profile and Business Model
Founded in October 1997, Gem Aromatics Limited has established itself as a prominent player in the specialty ingredients sector. The company specializes in manufacturing essential oils and aroma chemicals that cater to diverse industries including fragrance, flavor, pharmaceuticals, and fast-moving consumer goods (FMCG).
The company operates with a focus on sustainability and customer satisfaction, serving both domestic and international markets. With state-of-the-art technology implementation, Gem Aromatics has built enduring customer relationships based on quality commitment and product innovation.
Financial Performance
Gem Aromatics has demonstrated consistent financial growth over recent years. Revenue from operations increased from Rs 424.79 crore in FY23 to Rs 452.45 crore in FY24 and Rs 503.95 crore in FY25. PAT increased from Rs 44.67 crore in FY23 to Rs 50.10 crore in FY24 and Rs 53.38 crore in FY25.
The company’s financial trajectory shows:
- Revenue Growth: 11% increase between FY24 and FY25
- Profit Growth: 7% rise in profit after tax (PAT) during the same period
- Export Focus: A significant portion of revenue comes from export sales
- EBITDA Performance: EBITDA has increased by 28.13% over the previous year
Market Positioning and Competitive Landscape
The market capitalization of Gem Aromatics IPO is ₹1697.71 Cr as of March 31, 2025. The company operates in the specialty chemicals space, competing with players like Clean Science and other established manufacturers in the aroma chemicals segment.
Grey Market Premium (GMP) Analysis
Grey market premium signals 9–13% listing gains with some sources indicating The grey market premium suggests a potential listing gain of 10.77%. This positive GMP indicates strong investor interest and confidence in the company’s prospects, though investors should exercise caution as grey market premiums can be volatile.
Use of Proceeds
The company plans to utilize the IPO proceeds primarily for debt repayment, which should help improve its financial position and reduce interest burden. This strategic move is expected to strengthen the company’s balance sheet and support future growth initiatives.
Investment Perspective
The IPO’s attractiveness will largely hinge on valuation. At a fair pricing (25–30x earnings), Gem Aromatics offers a compelling mid-cap specialty chemicals story. At aggressive pricing (>40x earnings), the risk-reward turns less favourable according to market analysts.
The specialty chemicals sector has shown resilience and growth potential, particularly in the post-pandemic environment where demand for essential oils and aroma chemicals has remained robust across various end-user industries.
Risk Factors
Potential investors should consider various risk factors including:
- Dependency on raw material availability and pricing
- Competition from established players
- Regulatory changes in the chemicals industry
- Foreign exchange fluctuation risks for export-oriented business
- Market volatility in specialty chemicals sector
Leadership Team
The company is led by CEO Yash Vipul Parekh, with the Parekh family having significant involvement in the business operations. The experienced management team brings decades of industry expertise to guide the company’s growth strategy.
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