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Gem Aromatics Ltd Opens ₹451 Cr IPO: Price Band at ₹309–₹325, Listing on August 26
Mumbai: Gem Aromatics Ltd, a leading manufacturer of specialty ingredients and aroma chemicals, is set to open its Initial Public Offering (IPO) on August 19, 2025. The issue, aggregating to approximately ₹451 crore, will close on August 21, 2025 and is expected to list on the BSE and NSE on August 26, 2025.
The IPO will consist of a fresh issue of shares worth up to ₹175 crore and an offer for sale (OFS) of 85 lakh equity shares amounting to around ₹276 crore by existing shareholders.
Price Band and Lot Size
The company has set a price band of ₹309 to ₹325 per share. Investors can bid for a minimum of one lot comprising 46 shares, translating to a minimum application size of ₹14,950 at the upper price band.
The allocation will be divided between Qualified Institutional Buyers (QIBs), Non-Institutional Investors (NIIs), and Retail Individual Investors (RIIs) in the ratio of 50%, 15%, and 35% respectively.
Key Dates and Timeline
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IPO Opens: August 19, 2025
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IPO Closes: August 21, 2025
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Basis of Allotment: August 22, 2025
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Refunds Initiated: August 25, 2025
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Shares Credited to Demat Accounts: August 25, 2025
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Listing Date: August 26, 2025
Company Overview
Founded in 1997, Gem Aromatics Ltd operates in the specialty chemicals segment, producing a wide range of essential oils, aroma chemicals, and value-added derivatives. The company’s portfolio includes around 70 products, spanning categories such as mint and mint derivatives, clove derivatives, phenol, and other synthetic and natural ingredients.
These products cater to various industries including oral care, cosmetics, pharmaceuticals, nutraceuticals, personal care, and wellness. The company serves both domestic and international clients, including well-known brands in the FMCG, healthcare, and fragrance industries.
Gem Aromatics has three manufacturing facilities located in Budaun (Uttar Pradesh), Silvassa (Dadra & Nagar Haveli), and Dahej (Gujarat), along with a dedicated R&D centre in Maharashtra.
Financial Performance
In the financial year ending March 2025, the company reported revenues of approximately ₹504 crore, an increase of over 11% compared to the previous year. Net profit stood at ₹53.4 crore, reflecting a year-on-year growth of around 6.6%.
The company maintained a healthy return on equity of 18.8% and a debt-to-equity ratio of 0.78, indicating a balanced capital structure. Its earnings before interest, tax, depreciation, and amortisation (EBITDA) for FY25 stood at ₹88.5 crore.
Use of IPO Proceeds
Funds raised through the fresh issue will be primarily used for the repayment or prepayment of borrowings, including loans taken by its subsidiary, Krystal Ingredients Private Limited. The remainder will be allocated towards general corporate purposes and to strengthen the company’s balance sheet.
Strengths
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Diverse Product Portfolio: Around 70 products catering to multiple industries and geographies.
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Strong Client Relationships: Long-term associations with reputed domestic and global customers.
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Established Manufacturing Base: Facilities in strategic locations with robust production capabilities.
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Consistent Financial Growth: Steady revenue and profit growth over recent years.
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Experienced Management: Led by a team with decades of experience in the specialty chemicals and aroma segment.
Risks
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Product Concentration: A significant portion of revenue comes from mint and its derivatives, making the company vulnerable to fluctuations in raw material prices.
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Customer Dependency: High reliance on a few major clients for a substantial share of revenues.
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Market Volatility: Exposure to commodity price movements and global demand fluctuations.
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No Long-Term Contracts: Absence of binding long-term agreements with major buyers or suppliers could affect revenue stability.
Market Outlook
The specialty chemicals and fragrance industry in India is witnessing sustained demand, driven by growth in FMCG, personal care, wellness, and pharmaceutical segments. With its strong infrastructure, product diversity, and established client base, Gem Aromatics Ltd is well-positioned to benefit from these trends.
Market sentiment around the IPO is expected to be positive, with interest from both retail and institutional investors. However, given the concentration risks and dependence on certain raw materials, analysts suggest that potential investors should consider both the growth prospects and inherent risks before subscribing.
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