Investing Opportunity: Sanstar IPO
The Sanstar IPO, valued at a whopping ₹510 crore, kicked off for subscription on July 19 and will run until July 23. With a share price range of ₹90 to ₹95, investors have a chance to get in on the action.
Based in Ahmedabad, Sanstar’s IPO includes a fresh issuance of 4.18 crore shares and an offer for sale (OFS) of 1.19 crore shares. At the high end of the pricing spectrum, the IPO is valued at ₹510.15 crore.
The allocated funds from the IPO, totaling ₹181.55 crore, will be allocated for the development of the company’s Dhule facility, debt repayment amounting to ₹100 crore, and other general corporate purposes.
Sanstar stands out as a prominent manufacturer of plant-based specialty products and ingredient solutions in India.
The company’s range of specialty products, including ingredients, thickening agents, stabilizers, and sweeteners, play a vital role in enhancing the taste, texture, nutritional value, and overall appeal of various dishes.
With a production capacity of 1,100 tons per day from its manufacturing facilities in Dhule, Maharashtra, and Kutch, Gujarat, Sanstar caters to a diverse client base spanning 49 countries across Asia, Africa, the Middle East, the Americas, Europe, and Oceania, alongside a strong presence in 22 Indian states.
Sanstar has witnessed significant growth in its operating revenue, registering a CAGR of 45.46% to reach ₹1,067.27 crore in FY24 from ₹504.40 crore in FY22, while its profit after tax surged to ₹66.77 crore in FY24 from ₹15.92 crore in FY22.
Key Risks to Consider
Outlined in the company’s Red-Herring Prospectus (RHP) are some key risks that investors should be aware of before making any investment decisions.
