Dorf-Ketal Chemicals files IPO draft papers with SEBI to mop up ₹5,000 crore

Speciality chemicals company Dorf-Ketal Chemicals India Ltd has filed preliminary papers with markets regulator SEBI seeking its approval to raise ₹5,000 crore through an initial public offering (IPO).

The IPO comprises a fresh issue of equity shares aggregating up to ₹1,500 crore and an offer-for-sale of shares worth ₹3,500 crore by promoter Menon Family Holdings Trust, according to the draft red herring prospectus (DRHP) filed on Friday.

Proceeds from the fresh issue to the tune of ₹82.90 crore will be allocated to repay the debt of the company, ₹33.30 crore will be invested in subsidiary Dorf Ketal Chemicals FZE to repay or prepay its outstanding borrowings, and the remaining funds will be used for general corporate purposes.

Founded in 1992, Dorf-Ketal Chemicals is an R&D and innovation-focused global manufacturer and supplier of specialty chemicals across the hydrocarbons and industrial supply chains, including the oil and gas, refining and petrochemicals industries, and customers with diverse applications across industrial segments.

As on October 31, 2024, the company's customer base included Reliance Industries, Petronas, Indian Oil Corporation, PPG Industries, Clariant, Liberty Energy, Italiana Petroli, and Vedanta. During the six months ended September 2024, the company had 1,322 customers.

The company has 16 manufacturing facilities across four countries, including eight in India, two in Brazil, three in the US, and three in Canada as of October 2024.

With 542 patent registrations outside India, including 99 US patent registrations, and 29 patent registrations in India, the company is one of the few India-based chemical companies with global brand recognition.

The company has a strong track record of acquiring and integrating businesses driving expansion of the offerings and geographic footprint. The recent acquisitions include Texas-headquartered Impact Fluid Solutions LP in June 2024, Canada's Fluid Energy Group's global modified and synthetic acid business in January 2023, Clariant's North American land oil business in March 2023 and Khyati Chemicals Private Limited in April 2022.

From FY22 to FY24, the company's profit after tax surged at a compound annual growth rate (CAGR) of 50.18% to ₹60.20 crore and revenue from operations grew at a CAGR of 45.47% to ₹548 crore.

JM Financial Ltd, Citigroup Global Markets India Private Ltd, HSBC Securities and Capital Markets (India) Private Ltd, J.P. Morgan India, Morgan Stanley India Company, and Motilal Oswal Investment Advisors Ltd are the book-running lead managers to the issue.