IPO Alert: Aether Industries files for initial public offering

The global chemicals market was valued at around $5,027 billion in 2020, with India enjoying a market share of 4% that represents about $186 billion.

The Indian chemicals industry contributes approximately 6.6% of the national gross domestic product. It accounts for 15-17% of the value of the manufacturing sector and is expected to grow at a compound annual rate of 12.2% to $330 billion through 2025.

Aether Industries Limited has filed a preliminary prospectus with market regulator SEBI to raise ₹1,000 crores through an initial public offering.

The public issue consists of a fresh issue of shares aggregating ₹757 crores and an offer-for-sale of up to 2,751,000 shares, according to the draft red herring prospectus. The company may also consider raising ₹131 crores by issuing equity shares through a preferential offer.

The company plans to utilize the net proceeds from the fresh issue for funding the development of the proposed Greenfield project. A part of the proceeds will be used for repayment or prepayment of loans. It will use the remainder of the funds to meet working capital needs and for general corporate purposes.  

Specialty chemicals

Aether Industries is a speciality chemicals manufacturer in India, focused on the production of advanced intermediates and speciality chemicals that involve complex and differentiated chemistry and technology core competencies.

The Surat, Gujarat-based company started with a research and development unit in 2013 and began commercial production in 2017. It caters to the pharmaceutical, agrochemical, material science, electronic chemical, high-performance photography and oil & gas industries.

Aether Industries’ main competitors are Prakash Chemicals International, HP International, National Peroxide Limited, Dura Build Care and Palvi Industries.

Key Numbers

In fiscal 2021, the company’s operating revenue grew to ₹450 crores from ₹302 crores in fiscal 2020. Its net profit climbed to ₹71 crores from ₹40 crores last year. The company had total revenue of ₹454 crores, up 49% from the previous year.

Aether’s manufacturing processes involve the production, storage and transportation of various hazardous substances such as phenol, hydrogen, ethylene oxide and methanol. Such activities pose risks like potential leakages and explosions. The discharge/release of toxic or hazardous substances may cause personal injury, property damage and environmental contamination.