Vipul Org RI review - (Apply)

•    The company is engaged in the business of manufacturing and marketing of diverse range of dyes and chemicals.
•    It posted steady growth in its top and bottom lines for the reported periods. 
•    The RI is priced at a discount of around 67+ % making it a not to miss bet.
•    Promoter’s constant holding above 67% also generates confidence.
•    Investors may park funds for medium to long term in this lucratively priced RI.

PREFACE:
This company is coming out with its RI issue which is opening on March 21, 2025, but surprisingly its offer documents were uploaded on designated stock exchange BSE only on previous day post noon. The offer document is dated March 10, 2025, and has the same is the record date. Average investor is unable to understand such type of deliberations in case of Ris offer document uploading. Can anyone clarifies on this? 

ABOUT COMPANY:
Vipul Organics Ltd. (VOL) is engaged in the business of Dyes & Chemicals. It manufactures a diverse range of products, including pigment powder, pigment dispersion, leather dyes, naphthol, fast colour bases, and fast colour salts & dyes. These products cater to various industries such as printing ink, cosmetics & food industry, paper, paint, plastic, leather and textiles. The company currently serves clients across a broad spectrum of industries ranging from Paint, Plastic, Textiles, Printing Ink, Cosmetics & Food Industry, Paper and several others and has presence in both local and international market. In 1995, the company went public and is listed on the Bombay Stock Exchange (BSE).

Based in Maharashtra, it operates in three state-of-the-art facilities and it has a world-class R&D centre dedicated to testing dye and pigment products. The Company leverages a robust distribution network in India and internationally, ensuring its products reach diverse markets worldwide The company received the OEKO-TEX ECO PASSPORT for its entire Pigment and Reactive Dyes product range for the textile industry under the brand names SunPrint® and SunActive, respectively. This means that the entire product range of Vipul Organics for the Textile Industry is now certified as ZDHC (Zero Discharge of Hazardous Chemicals) Level 3. It is one of the very few global companies that have been awarded this certificate.

Moreover, it stands out as one of the only companies with an entire range of over 170+ products certified for level 3 Pigment Dispersions for textile printing under SunPrint brand, positioning it as one of the largest in the category of Pigments. Over 100+ products for Reactive Dyes under the brand name of SunActive are also certified Level 3. By being recognised as a manufacturer of eco-friendly dyes, Vipul Organics is well-positioned to serve as a preferred partner for sustainable textile and garment manufacturers worldwide. However, the offer document is silent on its employees’ strength. 

ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 4437291 equity shares of Rs. 10 each at a fixed price of Rs. 46.00 per share to mobilize Rs. 20.41 cr. The RI opens for subscription on March 21, 2025, and will close on April 02, 2025. The company is offering RI in the ratio of 1 for 3 to its eligible stakeholders as of the record date of March 10, 2025. The company is asking for full money on application for number of shares applied. Post allotment, shares will be listed on BSE. The company is spending Rs. 0.30 cr. for its RI and from the net proceeds, it will utilize Rs. 13.00 cr. for capex on construction of factory building and purchase of plant and machineries, Rs. 5.30 cr. for working capital, and Rs. 1.81 cr. for general corporate purposes. 

The RI is self-managed by the company itself., and Bigshare Services Pvt. Ltd. is the registrar to the issue. 

Post RI, company’s current paid-up equity capital of Rs. 13.31 cr. will stand enhanced to Rs. 17.75 cr. Based on RI pricing, the company is looking for a market cap of Rs. 81.65 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company has (on a consolidated basis) posted a total income/net profit of Rs. 134.00 cr. / Rs. 1.87 cr. (FY23), Rs. 150.99 cr. / Rs. 3.34 cr. (FY24). For 9M of FY25 ended on December 31, 2024, it earned a net profit of Rs. 3.64 cr. on a total income of Rs. 119.17 cr. 

DIVIDEND POLICY:
The company has paid a dividend of 9% for FY22 and FY23, and 10% for FY24. It will adopt a prudent dividend policy post listings of RI shares based on its financial performance and future prospects. 

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 530627 (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 210.80 on March 07, 2025, and opened on an ex-right basis at Rs. 151.00 on March 10, 2025. Since then, it has marked a high/low of Rs. 165.00 / Rs. 129.00. The scrip last closed at Rs. 140.70 as of March 20, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 265.17 / Rs. 112.70. 

The promoters’ holding has increased a bit to 67.76% for the quarter ended December 31, 2024, against 67.02% for quarter ended June30, 2024. The counter is well maintained above the RI price proving its fancy. The RI is at a discount of around 67.30% based on its last traded price.