Stallion India Fluorochemicals IPO opens on January 16: Check offer size, price band, business model and other key details

Stallion India Fluorochemicals Ltd is set to launch its initial public offering (IPO) to raise ₹199.45 crore from the primary market.

The mainboard issue of the seller of refrigerant gases and industrial gases will open for subscription on Thursday, January 16. The book-building offer will be available for subscription till Monday, January 20.

Here are some important details about the Stallion India Fluorochemicals IPO for the investors looking forward to participating in the subscription:

Stallion India Fluorochemicals IPO price band, lot size

Stallion India Fluorochemicals IPO is a combination of a fresh issue of 1.78 crore shares, worth up to ₹160.73 crore, and an offer-for-sale (OFS) of 43.05 lakh shares, amounting to ₹38.72 crore.

The IPO price band has been fixed at ₹85 to ₹90 per piece. Retail investors can bid for at least a single lot size of 165 shares, aggregating to a minimum investment of ₹14,850. The minimum application size of the small Non-Institutional Investors (sNII) is 14 lots, worth ₹2,07,900. The big NIIs (bNII) can apply for at least 68 lots, which amounts to a minimum investment of ₹10,09,800.

The company has proposed to reserve 50% of the net issue for Qualified Institutional Buyers (QIBs) and at least 35% for the retail category. The remaining 15% of the net issue will be allocated to the Non-Institutional Investors (NIIs).

Stallion India Fluorochemicals IPO key dates

Stallion India Fluorochemicals IPO share allotment status is scheduled to be finalised on January 21. The company will process refunds and transfer the shares to the Demat accounts on January 22.

Stallion India Fluorochemicals IPO listing date has been tentatively fixed as January 23. The stock will be listed on the NSE and BSE.

Stallion India Fluorochemicals: Key financials

Stallion India Fluorochemicals business model

Stallion India Fluorochemicals is engaged in the business of selling Refrigerant and Industrial Gases and related products. Its primary business consists of debulking, blending and processing of Refrigerant and Industrial gases, selling of pre-filled cans and small cylinders, or containers.

It has four facilities located in Maharashtra, Rajasthan and Haryana. Each of these facilities is designed and equipped to store gases in a controlled environment, ensuring adherence to the safety standards.

The company deals in gases classified as Fluorochemicals, which are majorly used as refrigerants. Its gases are used in various industries, such as air conditioners & refrigerators, fire safety, semiconductor manufacturing, automobile manufacturing, pharma and medicals, and aerosols and spray foam, among others.

Stallion is actively involved in the processing and blending of refrigerant and industrial gases, with the expertise in handling of raw materials and the process involved.

Stallion India Fluorochemicals key competitors

The key competitors of Stallion India Fluorochemicals are SRF Ltd, Gujarat Fluorochemicals Ltd and Navin Fluorine International Ltd.

Stallion India Fluorochemicals IPO: Ratios & KPIs

Stallion India Fluorochemicals IPO: Key strengths

Here’s a quick summary of the Stallion’s strengths:

• With more than 20 years in the industry Stallion has evolved into a recognised brand name in the refrigerant gases segment, according to the RHP.
• Factors like competitive pricing, excellent service, premium quality and innovation, set Stallion apart.
• Strong focus on timely deliveries and strict quality control has fostered industry relationships, driving significant operational growth, as per the IPO document.
• The company has been serving sectors like refrigeration, pharmaceuticals, semiconductors and automobiles. It reduces the company’s reliance on a single market, thereby ensuring resilience against industry-specific risks.
• The top ten customers consistently contribute over 70% of standalone revenue, highlighting a stable and dependable customer base supporting sustained business growth.
• A seamless supply chain ensures uninterrupted material flow, high precision, and adherence to top industry standards.

Stallion India Fluorochemicals IPO: Key risks

• With more than 80% of revenue coming from refrigerant gas sales, any decline in demand, or policy changes, could significantly impact the company’s sales, earnings and cash flow.
• A substantial portion of revenue is generated from Maharashtra and Delhi, which makes the company vulnerable to adverse social, economic, or political changes, in these regions.
• Reliance on refrigerant gases as primary raw materials exposes the company to cost fluctuations, potentially impacting profitability.
• Due to an absence of fixed agreements with suppliers, Stallion is more prone to risks of price hikes and supply disruptions, which could affect its operational stability.
• With over 90% of raw materials imported from China, any import restrictions, price fluctuations, or supply chain disruptions, could severely impact operations and profitability of the company.
• A demand notice from Zhejiang Sanmei Chemical for $1.25 million poses potential legal and financial challenges, which could impact the company’s reputation, cash flow, and financial stability.

The company’s promoters are Shazad Sheriar Rustomji, Manisha Shazad Rustomji and Rohan Shazad Rustomji. The promoters together hold 94.63% shareholding of the company pre-issue. The promoter shareholding post-issue will be reduced to 67.9%.