Chemplast Sanmar rises for sixth straight day after weak debut, up 21% from low

Shares of Chemplast Sanmar traded higher for the sixth consecutive day, rising 3 per cent to Rs 620 on the BSE in intra-day trade on Thursday after a poor listing last week.

With sources close to ฟอเร็กซ์ Exness ประเทศไทย, the specialist chemicals company's shares were trading at their highest level since listing on August 24, 2021. They are up 21 per cent from a low of Rs 510.30 on the day of listing. With the continued upward movement, the shares are now trading at 15% above the issue price of Rs 541 per share.

Chemplast Sanmar debuted on the bourses at Rs 525, 1 per cent below the issue price on the BSE.

The company manufactures specialty PVC resin pastes, starting materials and intermediates for the agrochemical, pharmaceutical, agrochemical and fine chemicals industries. It also produces other chemicals such as caustic soda, chlorochemicals, hydrogen peroxide, refrigerant gas and industrial salt.

On Wednesday, 1 September 2021, Chemplast Sanmar announced that on 31 August 2021, it had repurchased all outstanding non-convertible bonds (NCDs) issued by the company in December 2019.

The redemption of these NCDs worth Rs 1,238.25 crore, which were part of the objects of the initial issue, was done with the net proceeds of the Company's new issue of ordinary shares (IPO) held in August 2021.

The Company also announced that using the net proceeds of the offer for sale (OFS) received by the selling shareholders of Sanmar Holdings and Sanmar Engineering Services (SESL), the term loan provided to SESL by HDFC has been fully repaid.

Consequently, the security for this loan, including the pledge of the equity shares in Chemplast Cuddalore Vinyls (CCVL), a wholly owned subsidiary of Chemplast, was fully released by the Trustee on 31 August 2021. There is no lien on the CCVL shares owned by the company and the Chemplast Sanmar shares owned by the founders, the company said.

Analysts believe Chemplast Sanmar is well positioned to benefit from industry growth trends, given its diversified product portfolio that reduces the risk associated with any particular product, vertically integrated manufacturing facilities and strong parent support.

Going forward, given the high demand for its products, the company intends to increase its production capacity. This, they say, will help increase revenues as well as remove bottlenecks, leading to improved operational efficiency.