Safex Chemicals Files DRHP for ₹4,500 Crore IPO; Promoters and Investors to Offload 3.57 Crore Shares
By Shishta Dutta | Published at: Jul 5, 2025 01:06 PM IST
New Delhi, July 5, 2025: Safex Chemicals (India) Limited has filed its Draft Red Herring Prospectus (DRHP) with SEBI to launch an initial public offering (IPO) comprising a fresh issue of shares worth ₹4,500 crore and an offer for sale (OFS) of 3.57 crore equity shares by promoters and existing investors. The IPO also includes a provision for a pre-IPO placement of up to ₹900 crore, which would reduce the size of the fresh issue if completed.
The equity shares are proposed to be listed on both the National Stock Exchange (NSE) and BSE.
IPO Structure
| Instrument | Details |
|---|---|
| Fresh Issue | Equity shares aggregating up to ₹4,500 crore |
| Offer for Sale | 3,57,34,818 equity shares |
| Face Value | ₹1 per equity share |
| Employee Reservation | Up to 5% of post-offer capital |
| Proposed Listing | NSE, BSE |
The issue will result in capital infusion as well as a partial exit for promoters and institutional shareholders.
Key Shareholders Selling via OFS
| Name | Category | Shares Offered | Cost per Share (₹) |
|---|---|---|---|
| Sarcoline Limited | Investor | 2,91,05,996 | 62.11 |
| Anchor Partners | Investor | 10,88,234 | 83.48 |
| Sage Investment Trust | Investor | 6,05,770 | 83.48 |
| Surinder K. Chaudhary | Promoter | 11,51,088 | Nil (Gift) |
| Rajesh K. Jindal | Promoter | 7,48,198 | Nil (Gift) |
| Neeraj K. Jindal | Promoter | 4,99,098 | 1.64 |
| Piyush Jindal | Promoter | 4,99,098 | 1.64 |
| Other Family Shareholders | Promoter Group | Various | Mostly Nil |
The largest selling shareholder is Sarcoline Limited. Most promoter shares were acquired at nominal cost, indicating potential capital gains upon listing.
Use of IPO Proceeds (Fresh Issue)
| Utilization Head | Allocation (₹ crore) |
|---|---|
| Debt repayment (parent company) | 255.58 |
| Investment in Shogun Organics for loan reduction | 109.99 |
| General Corporate Purposes | To be finalized |
The majority of the funds raised through the fresh issue will be used to reduce group-level debt.
Financial Snapshot (Consolidated)
| Metric | FY25 | FY24 | FY23 |
|---|---|---|---|
| Revenue from Operations (₹ cr) | 1,584.78 | 1,404.59 | 1,161.02 |
| Net Loss (₹ cr) | (14.29) | (22.79) | (1.02) |
| Total Assets (₹ cr) | 2,084.36 | 1,923.42 | 1,905.17 |
| Total Borrowings (₹ cr) | 830.39 | 677.09 | 680.21 |
| Net Worth (₹ cr) | 611.46 | 626.15 | 648.88 |
While revenue grew across three consecutive fiscal years, net losses persisted primarily due to one-time charges such as goodwill impairment and increased remediation provisions.
Business Segments – Revenue Mix
| Segment | FY25 Share (%) | FY24 Share (%) | FY23 Share (%) |
|---|---|---|---|
| Branded Formulations | 62.47 | 58.76 | 65.73 |
| CDMO | 27.01 | 35.47 | 30.14 |
| Specialty Chemicals | 17.30* | 10.61* | 6.78* |
| Inter-segment Elimination | (6.78) | (4.84) | (2.66) |
The company continues to derive the bulk of its revenue from branded agrochemical formulations, although specialty chemicals have seen steady growth in share.
Promoter Shareholding Pre-IPO
| Promoter Name | Stake (%) |
|---|---|
| Neeraj Kumar Jindal | 10.43 |
| Piyush Jindal | 10.43 |
| Rajesh Kumar Jindal | 9.63 |
| Surinder Kumar Chaudhary | 7.48 |
| Total Promoter Group | 54.30 |
Post-offer, the promoter holding is expected to decrease but will likely remain significant, ensuring continued control.
Key Risk Disclosures
- Reported losses in FY23, FY24, and FY25
- High exposure to related party transactions and dealer-led sales
- ₹511 crore environmental remediation liability at UK subsidiary Briar Chemicals
- Working capital-intensive operations
- Revenue concentration from branded agrochemicals
- Forex exposure with 29% of FY25 revenue from overseas
These risks underscore the importance of evaluating financial sustainability and compliance-related liabilities prior to investment.
Lead Managers and Advisors
- Book Running Lead Managers: Axis Capital, JM Financial, SBI Capital Markets
- Registrar: KFin Technologies Ltd
- Legal Counsel: Trilegal
About the Company
Safex Chemicals (India) Limited, established in 1991 and headquartered in Delhi, operates across branded agrochemicals, specialty chemicals, and CDMO. The company has a presence in over 22 countries and manages 8 manufacturing facilities, including one in the UK. Its client portfolio includes global names such as Bayer AG and Godrej Consumer Products.
REF: https://nsearchives.nseindia.com/corporate/Registration_04072025230444_SafexChemicalsIndiaLimitedDRHP.pdf
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