Patel Chem Specialities Ltd IPO

The IPO opens on 25 Jul 2025 & closes on 29 Jul 2025.

Patel Chem Specialities Limited was originally incorporated on June 25, 2008 as 'Patel Chem Specialities Private Limited' with the Registrar of Companies, Gujarat. Company converted from a private limited to public limited and the name of the Company changed to 'Patel Chem Specialities Limited' and a fresh Certificate of Incorporation was issued on August 29, 2024, by the Registrar of Companies, CPC. Since the year 2008, Company manufactures Sodium Monochloro Acetate (SMCA), Sodium Starch Glycolate (SSG), Croscaremellose Sodium (CCS), Carboxymethyl Cellulose Calcium (Calcium CMC), Sodium Carboxymethyl Cellulose (Sodium CMC), Microcrystalline Cellulose (MCC)). Additionally, Sodium Monochloro Acetate (SMCA) is a key raw material for our products and has applications in drug production and nutritional products. The manufacturing plants are functional in Vatva, Ahmedabad, and Talod, Himmatnagar. Company operates in the field of specialty chemicals, particularly focusing on the production of cellulose-based excipients, which find application in Pharmaceutical, Food & Beverages, Cosmetics and other industries. These chemicals are fundamental in the formulation of essential products such as tablets, food additives, personal care items, and industrial formulations. The products play vital roles as binders, disintegrants, thickeners, stabilizers, and gelling agents, each serving a specialized function across multiple sectors. Company launched the Initial Public Offer of 70,00,000 Equity Shares of face value of Rs 10 by raising Rs 58.8 Cr thru' fresh issue in July, 2025. Vatva Unit has been registered as US-FDA approved facility in FY 2025.

Patel Chem Specialities Ltd IPO will close on 29 Jul 2025.

<ul><li>Product Portfolio.</li><li>Experienced Promoter and Management group.</li><li>Global Presence.</li><li>Diversified customer base.</li><li>Continuous innovation and quality consistency.</li></ul>

<table class="table"> <thead> <tr> <th>S.No</th> <th>Promoters Name</th> <th>Pre Issue Shares</th> <th>Pre Issue Percentage</th> <th>Post Issue Shares</th> <th>Post Issue Percentage</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Bhupesh Patel</td> <td>15128980</td> <td>84.66</td> <td>15128980</td> <td>60.83</td> </tr> <tr> <td>2</td> <td>Anshu Patel</td> <td>1496000</td> <td>8.37</td> <td>1496000</td> <td>6.02</td> </tr> <tr> <td>3</td> <td>Vini Patel</td> <td>170000</td> <td>0.95</td> <td>170000</td> <td>0.68</td> </tr> <tr> <td>4</td> <td>Bhupesh Patel -HUF</td> <td>204000</td> <td>1.14</td> <td>204000</td> <td>0.82</td> </tr> <tr> <td>5</td> <td>Neha Patwari</td> <td>1200</td> <td>0.01</td> <td>1200</td> <td>0.01</td> </tr> </tbody> </table>

<ul><li>We do not have long-term agreements with our suppliers for raw materials and an inability to procure the desired quality, quantity of our raw materials in a timely manner and at reasonable costs, or at all, may have a negative impact on our business, results of operations, financial condition and cash flows.</li><li>Majority of our domestic purchases and imports for the last 3 Financial Years and stub period is dependent on few states and single country. Any loss of business from any of these states and country may adversely affect our ability to procure our raw materials in time to meet our customers needs.</li><li>Majority of our domestic sales for the last 3 Financial Years and stub period is dependent on few states. Any loss of business from any of these states may adversely affect our revenues and profitability.</li><li>The restated financial statements have been provided by peer reviewed auditor who is not statutory auditor of our Company.</li><li>Our Major Exports are to Egypt, United States, Russia, Republic of Korea, United Kingdom, Japan and Germany. Any loss of business from any of these countries may adversely affect our revenues and profitability.</li><li>There may be potential conflict of interests between our Company and M/s Patel Industries.</li><li>Our international operations expose us to complex management, legal, tax, foreign exchange and economic risks, which could adversely affect our business, results of operations and financial condition.</li><li>Under-utilization of our production capacities could have an adverse effect on our business, future prospects and future financial performance.</li><li>Risk of Potential Machinery Strain and Operational Challenges Due to Overutilization of Installed Capacity.</li><li>The Company is in process of obtaining Fire NOC from the Fire Safety department for plot A1/272/5 and A2/272/4, GIDC Industrial Estate, Vatva, Ahmedabad - 382445 and Survey No. 93, Talod- Himmatnagar Road, Ahmedpura, Talod, Sabarkantha 383215, Gujarat, India.</li><li>Our business is dependent on the performance of certain other industries which we are serving particularly pharmaceuticals, food and beverages, cosmetics, etc. Any adverse changes in the conditions affecting these industries can adversely impact our business and financial condition.</li><li>We do not own the premises viz. Unit 272/5 located at Vatva, GIDC in which our manufacturing unit is located and the same is on lease arrangement. Any termination of such lease/license and/or non-renewal thereof and attachment by Property Owner could adversely affect our operations.</li><li>There have been some instances of delayed in the past with the Registrar of Companies which may attract penalties.</li><li>Our lenders have charge over our movable properties and book debts in respect of finance availed by us.</li><li>Secured loans have been availed by us which may be recalled by lenders.</li><li>We have issued Equity Shares during the last one year at a price that may be below the Issue Price.</li><li>There have been some instances of delays in filing of statutory and regulatory dues in the past with the various government authorities.</li><li>Information relating to the installed production capacity and capacity utilization of our production unit included in this Draft Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.</li><li>The Objects of the Issue for which funds are being raised, are based on our management estimates and any bank or financial institution or any independent agency has not appraised the same. The deployment of funds in the project is entirely at our discretion, based on the parameters as mentioned in the chapter titled "Objects of the Issue".</li><li>We are involved in certain legal proceedings, which, if determined adversely, may affect our business and financial condition.</li><li>Our Promoters have provided personal guarantee for loans availed by us.</li><li>We intend to utilise a portion of the Net Proceeds for funding our capital expenditure requirements. We are yet to place orders for 100% of the Plant and Machinery, as specified in the Objects of the Issue chapter. Any delay in procurement of such Plant & Machinery may delay the schedule of implementation and may also lead to increase in cost of these Plant & Machinery, further affecting our revenue and profitability.</li><li>Any failure in our Quality control process failures may harm our business and financial condition, leading to potential product liability claims and legal actions if our products don't meet customer expectations</li><li>Our manufacturing process requires our labourers to work under potentially dangerous circumstances. In the event of any accidents, our Company may be held liable for damages and penalties which may impact the financials of our Company.</li><li>We depend on our Promoters, Directors, Key Managerial Personnel and Senior Management and we heavily rely on their knowledge and experience in operating our business and therefore, it is critical for our business that they remain associated with us.</li><li>Depletion of forest reserves could lead to a reduction in the availability of raw materials, potentially causing an increase in the cost of raw materials.</li><li>The unexpected loss, shutdown or slowdown of operations at our manufacturing unit could have a material adverse effect on our results of operations and financial condition.</li><li>We have experienced negative cash flows from operating, investing and financing activities in the past.</li><li>Changes in technology and advancement of methods and machineries may render our current technologies and plant and machinery obsolete or require us to make substantial capital investments.</li><li>Our business is subject to extensive regulation, if we fail to comply or obtain and renew certain registrations, licenses and permits from government and regulatory authorities may adversely affect our business operations.</li><li>Our success depends on stable and reliable logistics and transportation infrastructure. Disruption of logistics and transportation services could impair the ability of our suppliers to deliver raw materials or our ability to deliver products to our customers and/ or increase our transportation costs, which may adversely affect our operations. We are also 100% dependent on third-party transportation providers for the supply of raw materials and delivery of our finished products.</li><li>We have significant power and water requirements for continuous running of our factories. Any disruption to our operations on account of interruption in power and water supply or any irregular or significant hike in power tariffs may have an effect on our business, results of operations and financial condition.</li><li>Our Company has in the past entered into related party transactions and may continue to do so in the future. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on our Company's financial condition and results of operations.</li><li>Certain sections of this Draft Red Herring Prospectus contain information from the Industry Report which has been exclusively commissioned and paid for by us in relation to the Issue and any reliance on such information for making an investment decision in this offering is subject to inherent risks.</li><li>Our ability to pay dividends in the future may be affected by any material adverse effect on our future earnings, financial condition cash flows, working capital requirements, capital expenditures and restrictive covenants in our financing arrangements.</li><li>Our Company's management will have flexibility in utilizing the Net Proceeds from the Issue. The deployment of the Net Proceeds from the Issue is being monitored by the Audit Committee and not an independent monitoring agency.</li><li>Compliance with, and changes in, safety, health and environmental laws and various labour, workplace and related laws and regulations impose additional costs and may increase our compliance costs and a such adversely affect our results of operations and our financial condition.</li><li>If we do not successfully develop or commercialise new products in a timely manner, or if the products that we commercialise do not perform as expected, our business, results of operations and financial condition may be adversely affected.</li><li>We may not be able to identify or effectively respond to evolving preferences, expectations or trends in a timely manner and a failure to derive the desired benefits from our product development efforts may impact our competitiveness and profitability.</li><li>Our inability to effectively manage our growth or to successfully implement our business plan and growth strategy could adversely affect our business, results of operations and financial condition.</li><li>We have not identified any alternate source of financing the 'Objects of the Issue'.</li><li>Our business depends on protection of our intellectual property in our product range. Our ability to compete effectively will be impaired if we are unable to protect our intellectual property rights.</li><li>Our Promoters and members of the Promoter Group will continue jointly to retain majority control over our Company even after the Issue which will allow them to determine the outcome of matters submitted to shareholders for approval.</li><li>Our insurance coverage may not be adequate to protect us against certain operating hazards and this may have a material adverse effect on our business.</li><li>The average cost of acquisition of Equity Shares by our Promoters could be lower than the issue price.</li><li>Our Promoters, Directors and Key Managerial Personnel may have interest in our Company, other than reimbursement of expenses incurred, remuneration or other benefits received.</li><li>We face numerous protective trade restrictions, including anti-dumping laws, countervailing duties and tariffs, which could adversely affect our revenue from exports.</li><li>The Price of our Equity Shares may be volatile, or an active trading market may not develop.</li><li>If we are subject to any frauds, theft, or embezzlement by our employees, suppliers or customers, it could adversely affect our reputation, results of operations, financial condition and cash flows.</li><li>Strikes, work stoppages or increased wage demands by our employees or any other kind of disputes with our employees/workmen in future could adversely affect our business and results of operations.</li><li>The requirements of being a listed company may strain our resources.</li><li>Compliance with, and changes in, safety, health and environmental laws and various labour, workplace and related laws and regulations impose additional costs and may increase our compliance costs and a such adversely affect our results of operations and our financial condition.</li><li>We cannot assure you that our equity shares will be listed on the SME platform of BSE in a timely manner or at all, which may restrict your ability to dispose of the equity shares.</li><li>Sale of Equity Shares by our Promoters or other significant shareholder(s) may adversely affect the trading price of the Equity Shares.</li><li>After this Issue, the price of the Equity Shares may be highly volatile, or an active trading market for the Equity Shares may not develop.</li><li>We have been recently converted into public limited company and any non-compliance with the provisions of Companies Act, 2013 may attract penalties against our Company which could impact our financial and operational performance and reputation.</li><li>The Issue price of our Equity Shares may not be indicative of the market price of our Equity Shares after the Issue and the market price of our Equity Shares may decline below the issue price and you may not be able to sell your Equity Shares at or above the Issue Price.</li><li>The company does not have long-term agreements with its suppliers for raw materials and an inability to procure the desired quality, quantity of its raw materials in a timely manner and at reasonable costs, or at all, may have a negative impact on the company business, results of operations, financial condition and cash flows.</li><li>The Company has in the past entered into related party transactions and may continue to do so in the future. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on the Company's financial condition and results of operations.</li><li>Majority of its domestic purchases and imports for the last 3 Financial Years is dependent on few states and single country. Any loss of business from any of these states and country may adversely affect its ability to procure the company raw materials in time to meet the company customers needs.</li><li>Majority of its domestic sales for the last 3 Financial Years is dependent on few states. Any loss of business from any of these states may adversely affect the company revenues and profitability.</li><li>The restated financial statements have been provided by peer reviewed auditor who is not statutory auditor of the Company.</li><li>Its Major Exports are to Egypt, United States, Russia, South Korea, United Kingdom, Japan and Germany. Any loss of business from any of these countries may adversely affect its revenues and profitability.</li><li>The company does not own the premises viz. Unit 272/5 located at Vatva, GIDC in which its manufacturing unit is located and the same is on lease arrangement. Any termination of such lease/license and/or non-renewal thereof and attachment by Property Owner could adversely affect its operations.</li><li>There have been some instances of delayed in the past with the Registrar of Companies which may attract penalties.</li><li>Secured loans have been availed by it which may be recalled by lenders.</li><li>The company has experienced negative cash flows from operating, investing and financing activities in the past.</li><li>There may be potential conflict of interests between the Company and M/s Patel Industries.</li><li>Under-utilization of its production capacities could have an adverse effect on the company business, future prospects and future financial performance.</li><li>Risk of Potential Machinery Strain and Operational Challenges Due to Overutilization of Installed Capacity</li><li>The Company is in process of obtaining Fire NOC from the Fire Safety department for plot A1/272/5 and A2/272/4, GIDC Industrial Estate, Vatva, Ahmedabad - 382445 and Survey No. 93, Talod- Himmatnagar Road, Ahmedpura, Talod, Sabarkantha 383215, Gujarat, India.</li><li>Its business is dependent on the performance of certain other industries which the company is serving particularly pharmaceuticals, food and beverages, cosmetics, etc. Any adverse changes in the conditions affecting these industries can adversely impact its business and financial condition.</li><li>The company lenders have charge over our movable properties and book debts in respect of finance availed by the company.</li><li>The company has issued Equity Shares during the last one year at a price that may be below the Issue Price.</li><li>There have been some instances of delays in filing of statutory and regulatory dues in the past with the various government authorities.</li><li>Information relating to the installed production capacity and capacity utilization of its production unit included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.</li><li>The company may be in Non-Compliance with MSME Payment Obligations.</li><li>The Objects of the Issue for which funds are being raised, are based on its management estimates and any bank or financial institution or any independent agency has not appraised the same. The deployment of funds in the project is entirely at its discretion, based on the parameters as mentioned in the chapter titled "Objects of the Issue".</li><li>The company is involved in certain legal proceedings, which, if determined adversely, may affect its business and financial condition.</li><li>Its Promoters have provided personal guarantee for loans availed by the company.</li><li>The company intend to utilise a portion of the Net Proceeds for funding its capital expenditure requirements. The company is yet to place orders for 100% of the Plant and Machinery, as specified in the Objects of the Issue chapter. Any delay in procurement of such Plant & Machinery may delay the schedule of implementation and may also lead to increase in cost of these Plant & Machinery, further affecting its revenue and profitability.</li><li>Any failures in its Quality control process failures may harm our business and financial condition, leading to potential product liability claims and legal actions if the company products don't meet customer expectations.</li><li>Its manufacturing process requires our labourers to work under potentially dangerous circumstances. In the event of any accidents, the Company may be held liable for damages and penalties which may impact the financials of the Company.</li><li>The company depends on its Promoters, Directors, Key Managerial Personnel and Senior Management and the company heavily rely on their knowledge and experience in operating its business and therefore, it is critical for the company business that they remain associated with it.</li><li>Depletion of forest reserves could lead to a reduction in the availability of raw materials, potentially causing an increase in the cost of raw materials.</li><li>The unexpected loss, shutdown or slowdown of operations at its manufacturing unit could have a material adverse effect on the company results of operations and financial condition.</li><li>Changes in technology and advancement of methods and machineries may render its current technologies and plant and machinery obsolete or require it to make substantial capital investments.</li><li>Its business is subject to extensive regulation, if the company fails to comply or obtain and renew certain registrations, licenses and permits from government and regulatory authorities may adversely affect its business operations.</li><li>The company success depends on stable and reliable logistics and transportation infrastructure. Disruption of logistics and transportation services could impair the ability of its suppliers to deliver raw materials or the company ability to deliver products to its customers and/ or increase the company transportation costs, which may adversely affect its operations. The company is also 100% dependent on third-party transportation providers for the supply of raw materials and delivery of its finished products.</li><li>The company has significant power and water requirements for continuous running of its factories. Any disruption to the company operations on account of interruption in power and water supply or any irregular or significant hike in power tariffs may have an effect on its business, results of operations and financial condition.</li><li>Certain sections of this Red Herring Prospectus contain information from the Industry Report which has been exclusively commissioned and paid for by it in relation to the Issue and any reliance on such information for making an investment decision in this offering is subject to inherent risks.</li><li>Its ability to pay dividends in the future may be affected by any material adverse effect on its future earnings, financial condition cash flows, working capital requirements, capital expenditures and restrictive covenants in the company financing arrangements.</li><li>Compliance with, and changes in, safety, health and environmental laws and various labour, workplace and related laws and regulations impose additional costs and may increase its compliance costs and a such adversely affect our results of operations and the company financial condition.</li><li>Its funding requirements and proposed deployment of the Net Proceeds are based primarily on management estimates and assumptions and have not been appraised by any bank or financial institution or any other independent agency. The utilization of the Net Proceeds may be subject to change based on various factors, some of which are beyond its control and such utilisation may not generate expected future revenues or profits after utilisation. Further, any change or variation in the utilization of Net Proceeds from the terms and conditions stated in this Red Herring Prospectus shall be subject to compliance requirements, including among other things, prior Shareholders' approval.</li><li>If the company does not successfully develop or commercialise new products in a timely manner, or if the products that we commercialise do not perform as expected, our business, results of operations and financial condition may be adversely affected.</li><li>Its may not be able to identify or effectively respond to evolving preferences, expectations or trends in a timely manner and a failures to derive the desired benefits from its product development efforts may impact the company competitiveness and profitability.</li><li>The company inability to effectively manage its growth or to successfully implement the company business plan and growth strategy could adversely affect its business, results of operations and financial condition.</li><li>Its inability to effectively manage the company growth or to successfully implement its business plan and growth strategy could adversely affect the company business, results of operations and financial condition.</li><li>Its business depends on protection of the company intellectual property in its product range. The company ability to compete effectively will be impaired if the company is unable to protect its intellectual property rights.</li><li>Its Promoters and members of the Promoter Group will continue jointly to retain majority control over the Company even after the Issue which will allow them to determine the outcome of matters submitted to shareholders for approval.</li><li>Its insurance coverage may not be adequate to protect it against certain operating hazards and this may have a material adverse effect on its business.</li><li>The average cost of acquisition of Equity Shares by its Promoters could be lower than the issue price.</li><li>Its Promoters, Directors and Key Managerial Personnel may have interest in the Company, other than reimbursement of expenses incurred, remuneration or other benefits received.</li><li>The company faces numerous protective trade restrictions, including anti-dumping laws, countervailing duties and tariffs, which could adversely affect its revenue from exports.</li><li>The Price of its Equity Shares may be volatile, or an active trading market may not develop.</li><li>If the company is subject to any frauds, theft, or embezzlement by its employees, suppliers or customers, it could adversely affect the company reputation, results of operations, financial condition and cash flows.</li><li>Strikes, work stoppages or increased wage demands by its employees or any other kind of disputes with the company employees/workmen in future could adversely affect its business and results of operations.</li><li>The requirements of being a listed company may strain its resources.</li><li>The company cannot assure you that its equity shares will be listed on the SME platform of BSE in a timely manner or at all, which may restrict your ability to dispose of the equity shares.</li><li>Sale of Equity Shares by its Promoters or other significant shareholder(s) may adversely affect the trading price of the Equity Shares.</li><li>After this Issue, the price of the Equity Shares may be highly volatile, or an active trading market for the Equity Shares may not develop.</li><li>The company has been recently converted into public limited company and any non-compliance with the provisions of Companies Act, 2013 may attract penalties against the Company which could impact its financial and operational performance and reputation.</li><li>The Issue price of its Equity Shares may not be indicative of the market price of the company Equity Shares after the Issue and the market price of its Equity Shares may decline below the issue price and you may not be able to sell your Equity Shares at or above the Issue Price.</li></ul>

The Issue type of Patel Chem Specialities Ltd is Book Building - SME.

The minimum application for shares of Patel Chem Specialities Ltd is 3200.

The total shares issue of Patel Chem Specialities Ltd is 7000000.

Initial public issue of up to 70,00,000 equity shares of Rs. 10/- each ("Eequity Shares") of patel chem specialities limited ("Patel Chem" or "PCSL" or the "Company") for cash at a price of Rs. 84/- per equity share (the "Issue Price"), aggregating to Rs. 58.80 crores ("the Issue"). Out of the issue, 3,53,600 equity shares aggregating to Rs. 2.97 crores will be reserved for subscription by market maker ("Market Maker Reservation Portion"). The issue less the market maker reservation portion i.e. net issue of 66,46,400 equity shares of face value of Rs. 10/- each at an issue price of Rs. [*]/- per equity share aggregating to Rs. 55.83 crores is hereinafter referred to as the "Net Issue". The issue and the net issue will constitute 28.15 % and 26.72 %, respectively of the post issue paid up equity share capital of the company.