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IPO Review: Advantage Advanced Enzyme

Niche play with robust growth potential should translate to higher earnings trajectory

(From left) C L Rathi (MD, AETL), V L Rathi (ED, AETL) and Beni Rauka (CFO, AETL) at the IPO press conference for Advanced Enzyme in Mumbai
(From left) C L Rathi (MD, AETL), V L Rathi (ED, AETL) and Beni Rauka (CFO, AETL) at the IPO press conference for Advanced Enzyme in Mumbai

Advanced Enzyme Technologies, one of the largest enzyme makers in the world, is raising Rs 400 crore via an initial public offering (IPO), which is largely an offer for sale by promoters and other investors. While only Rs 50 crore of the IPO is through fresh issue of shares, which will be used to repay debt at the company’s US subsidiary, there are reasons that make the IPO attractive including good business prospects, strong track record, niche limited competition segment the company operates in, higher entry barriers, and reasonable valuations. The company, which gets about ...