The Tarsons Products IPO opens on November 15: Does the price, GMP, strength, and valuation make it worth investing?

On November 15, Monday, Tarsons Products, a life sciences company based in West Bengal, launched its initial public offering (IPO). The company’s goals with the offer are to establish a new plant and use the proceeds for its general corporate purposes. Two days from now, on November 17, the Rs 1,023-crore share issue will close. 

It was founded in 1983 and specializes in the design, development, manufacture and marketing of labware products, including benchtop equipment, which research institutions use, academic institutions, pharmaceutical manufacturers, contract research organizations, diagnostic companies and hospitals.

The IPO of Tarson Products is explained in detail in the following article:

• IPO dates for Target Products

The Tarson products initial public offering will take place between November 15 and 17. As a result, the bidding process for this company will last three days. 

• Price of Tarson Products’ initial public offering

Shares of Tarsons Products are priced between Rs 635 and Rs 662 in their IPO. Tarsons Products plans to raise Rs 1,023.50 crore from the IPO. There are 1,32,00,000 equity shares to be sold against the company’s new issue of Rs 150 crore and an offer for sale of Rs 873.47. Bids must be at least 22 shares and in multiples thereof to be eligible for the sale. 

• IPO GMP for Tarson Products

At the grey market on Monday, Tarsons Products shares were trading at Rs 892. The price has increased by almost 135 per cent from its upper price band of Rs 662 per share. Consequently, they are expected to list at the BSE and NSE later this month. 

• Reservations for the IPO of Tarson Products

Investors can subscribe to the Tarson Products IPO in three categories: qualified institutional buyers (QIBs), non-institutional buyers, and retail investors. The shares are available to qualify institutional buyers for a maximum of 50 per cent of each. The retail offer is reserved for around 35 per cent of the claims, while non-institutional buyers can purchase the remaining 15 per cent. 

• This issue has the following objectives:

Tarson Products will use the proceeds of its IPO in three ways:

1. I am repaying or prepaying all or certain of its borrowings.
2. A portion of the capital expenditures for a new manufacturing facility in Panchla, West Bengal, will be funded by this sponsorship.
3. General company purposes. 

• Valuation of the Tarson Products IPO

In West Bengal, Tarsons Products Limited has five manufacturing facilities. The company manufactures labware products to help advance scientific discovery and enhance healthcare. With over 1,700 SKUs across 300 products, the company has a diverse product portfolio. Consumer goods include PCR consumables, centrifuge, cryogenic, liquid handling, Petri dishes, transfer pipettes, and various products, including bottles, carboys, beakers, measuring cylinders, and reusable tube racks. Instruments such as vortex shakers, centrifuges, pipettors, and others are also available for benchtop use.

Due to a surge in demand for medical supplies, the company’s revenues increased during the pandemic. Between 2019 and 2021, Tarson Products’ revenue increased from Rs 184.7 crore to Rs 234.3 crore. Based on reports, profits jumped from Rs 39 crore to Rs 68.9 crore.

SBI Capital Markets, Edelweiss Financial Services and ICICI Securities will book run the issue. A registrar will be KFintech Private Limited, on the other hand.

Invest or Not?

Religare Broking has shared a positive review of the IPO. It said, “Tarsons has a solid market share of 9-12 per cent in India, quality products, and strong brand recognition that will enable it to benefit from market trends.”. The company also offers labware products to different customer segments. 

The company has a pan-India sales and distribution network that covers a wide geographical area. It plans to grow its product line, expand its manufacturing capabilities, and expand its global footprint in the future. Maintaining operational efficiency and profitability will also be a priority. Sales and net profit have increased by 13 per cent and 33 per cent, respectively, during FY19-21.”

Article Proofread and Edited by Shreedatri Banerjee