About Nexxus Petro Industries IPO

Incorporated in October 2021, Nexxus Petro Industries Limited is involved in the trading, manufacturing, and sale of petrochemical products, particularly bitumen products. The company produces and distributes high-quality bitumen, bitumen emulsions, and special bituminous allied products to infrastructure/construction companies, government agencies, road authorities, and the bitumen industry. The company has three manufacturing units each in Gujarat, Rajasthan and Madhya Pradesh. As of September 2024, the company has 17 permanent employees.

The Objectives of the Issue

Nexxus Petro Industries Limited intends to utilize the Net Proceeds from the Issue for the following purposes:

1. Funding the working capital requirements of the company
2. General corporate purposes

Highlights of Nexxus Petro Industries IPO

Nexxus Petro Industries IPO is a fixed price issue of ₹19.43 crores.  The issue is entirely fresh. Here are the key details of the IPO:

• The IPO opens for subscription on 26th September 2024 and closes on 30th September 2024.
• The allotment is expected to be finalised on 1st October 2024.
• Refunds will be initiated on 3rd October 2024.
• Credit of shares to Demat accounts is also expected on 3rd October 2024.
• The company will tentatively list on BSE SME on 4th October 2024.
• The issue price is fixed at ₹105 per share.
• The fresh issue comprises 18.5 lakh shares, aggregating to ₹19.43 crores.
• The minimum lot size for the application is 1200 shares.
• Retail investors need to invest a minimum of ₹126,000.
• The minimum investment for HNI is 2 lots (2,400 shares), amounting to ₹252,000.
• Srujan Alpha Capital Advisors Llp is the book-running lead manager for the IPO.
• Kfin Technologies Limited serves as the registrar.
• Gretex Share Broking is the market maker for the IPO.

Nexxus Petro Industries IPO - Key Dates

The cut-off time for UPI mandate confirmation is 5:00 PM on 30th September 2024. This deadline is crucial for investors to ensure their applications are processed successfully. Investors are advised to complete their applications well before this deadline to avoid any last-minute technical issues or delays.

Nexxus Petro Industries IPO Issue Details/Capital History

The Nexxus Petro Industries IPO is scheduled from 26th September to 30th September 2024, with a fixed price of ₹105 per share and a face value of ₹10. The total issue size is 18,50,400 shares, raising up to ₹19.43 crores through a fresh issue. The IPO will be listed on BSE SME. The pre-issue shareholding is 51,00,000 shares.

Nexxus Petro Industries IPO Allocation & Minimum Investment Lot Size

The IPO shares are allocated across different investor categories as follows:

Investors can place bids for a minimum of 1200 shares, with additional bids required in multiples of this figure. The table below illustrates the minimum and maximum investment amounts for retail investors and HNIs, expressed in shares and monetary values.

SWOT Analysis: Nexxus Petro Industries Ltd

Strengths

• Experienced management team
• Strong supplier relationships
• Well-equipped factories with modern machines and advanced processes
• BIS and ISO certifications for products and processes

Weaknesses:

• Relatively new company, incorporated in October 2021
• Limited number of permanent employees (17 as of September 2024)

Opportunities:

• Growing demand for bitumen products in infrastructure and construction sectors
• Potential for expansion into new geographical markets
• Increasing focus on road development projects in India

Threats:

• Fluctuations in raw material prices, especially crude oil
• Intense competition in the petrochemical industry
• Regulatory changes affecting the bitumen and construction sectors
   

Financial Highlights: Nexxus Petro Industries Ltd

Below are the financial results for FY24, FY23, and FY22:

Nexxus Petro Industries Limited has shown significant growth in recent years. The company's revenue increased by 67%, and profit after tax (PAT) rose by 73% between the financial year ending on 31st March 2024 and 31st March 2023.

Assets have shown substantial growth, increasing from ₹932.77 lakhs in FY22 to ₹3,892.55 lakhs in FY24, representing a growth of about 317% over two years.

Revenue has seen exponential growth, rising from ₹4,847.02 lakhs in FY22 to ₹23,837.57 lakhs in FY24, marking an impressive increase of 391.8% over two years.

The company's profitability has improved significantly. Profit After Tax increased from ₹54.06 lakhs in FY22 to ₹348.47 lakhs in FY24, representing a substantial growth of 544.6% over two years.

Net Worth has shown strong growth, increasing from ₹54.06 lakhs in FY22 to ₹863.4 lakhs in FY24, a growth of about 1,497% over two years.

Total Borrowings have increased from ₹369.83 lakhs in FY22 to ₹2,161.43 lakhs in FY24, which represents an increase of about 484% over two years. This significant increase in borrowings, coupled with the rapid growth in assets and revenue, suggests that the company is in an aggressive expansion phase.

The company's financial performance shows a trend of exceptionally strong revenue growth and improving profitability. However, the rapid increase in borrowings has led to a high debt-to-equity ratio of 2.5, which investors should consider. The substantial increase in Net Worth indicates a strengthening financial position, but it's important to note that the company is still relatively young and in a high-growth phase. Investors should evaluate these financial trends along with the company's market position and future growth prospects when considering the IPO.