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Sigachi Industries IPO opens: Should you subscribe?

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The initial public offering (IPO) of Sigachi Industries, a Hyderabad-based manufacturer of cellulose-based excipients, opens today. This will be the third IPO to be available for bids on the day along with Policybazaar and SJS Enterprises.

Sigachi Industries IPO opens: Should you subscribe?
The initial public offering (IPO) of Sigachi Industries, a Hyderabad-based manufacturer of cellulose-based excipients, opened on Monday. This is the third IPO to be available for bids on the day along with Policybazaar and SJS Enterprises.
The price band for the issue, which closes on November 3, has been fixed at Rs 161-163 a share. Sigachi is planning to raise Rs 125.43 crore at the upper price band by issuing 76.95 lakh shares.
The allotment of the issue is likely to take place on November 10.
Brokerage firm Adand Rathi gave the IPO a subscribe rating given the company is one of the leading manufacturers of
microcrystalline cellulose in India with over 30 years of experience.
At the upper end of the price band, Sigachi Industries Ltd is offered at a P/E ratio of 15.1x its TTM earnings, with a market capitalisation of Rs 5,011 million. Given that the company is one of the leading manufacturers of
microcrystalline cellulose in India with over 30 years of experience, pan-India and international market presence, experienced management team and investment-led future growth with a high RoNW of 32.12 percent in FY21 and a reasonable valuation, the brokerage noted.
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