Nova Agritech IPO

Nova Agritech Limited

₹14,235 /365 sharesMinimum Investment

Nova Agritech IPO Listing Details

Listed OnIssue PriceListing PriceListing Gains
BSE & NSE₹41.00₹56.00₹15.00 (36.59%)

Nova Agritech IPO Details

Bidding DatesMin. InvestmentLot SizePrice Range
23 Jan ‘24 - 25 Jan ‘24₹14,235365₹39 - ₹41
Issue SizeIPO Doc
143.81Cr
RHP PDF

Subscription Status As on 25 Jan '24, 5:50 PM

  • Qualified Institutional Buyers
    79.31x
  • Non-Institutional Investor
    224.06x
  • Retail Individual Investor
    77.11x
  • Total
    109.37x

About Nova Agritech

Nova Agritech Solutions is an agri-input manufacturer, established in 2007. It specializes in a range of products aimed at enhancing soil health, crop nutrition, and crop protection. The company focuses on technology-based solutions that prioritize ecological sustainability and nutritional balance, stemming from extensive Research and Development. The company's product portfolio includes soil health management products, crop nutrition and biostimulant products, bio pesticides, Integrated Pest Management products, and advanced crop protection technologies. Their subsidiary, Nova Agri Sciences Private Limited, manufactures the crop protection products. Nova Agritech Solutions has a robust dealer network, comprising approximately 11,722 dealers across 16 Indian states and two regions in Nepal, with plans to expand to Bangladesh, Sri Lanka, and Vietnam. The company primarily generates revenue from Andhra Pradesh, Karnataka, and Telangana. ;
Parent Organisation
Nova Agritech Limited
Founded
2007
Managing Director
Kiran Kumar Atukuri

Strengths & Risks

  • Nova Agritech Solutions offers solutions for diverse agricultural needs. Their product range covers soil health management, crop nutrition, bio stimulants, bio pesticides, Integrated Pest Management, and crop protection. The company had 720 product registrations as of November 2023.
  • The company has a widespread distribution network, comprising approximately 11,722 dealers across 16 Indian states and in Nepal. This enables timely delivery of products, crucial in the seasonal agricultural industry. It has also expanded into international markets like Bangladesh, Sri Lanka, and Vietnam.
  • Nova Agritech's 'Nova Kisan Seva Kendra' program is aimed at farmer education and outreach. Employing agri-graduates and grassroots workers like Kisan Mitras and Kisan Sevaks, they offer tailored agricultural solutions and knowledge.
  • The company adopts technology for product development and market analysis, thereby creating products that can cater to current market demands and farmer needs.
  • Company uses its in-house R&D facility and Quality Control/Assurance capabilities to focus on innovation and quality. Collaborations with universities and the utilization of leased land for product testing helps the company to develop effective and sustainable agricultural solutions.
  • Nova Agritech works towards enhancing farmer engagement and loyalty by offering comprehensive advisory services and introducing subscription-based access to modern technologies like Agribot and Bhuparikshak. This approach caters to immediate agricultural needs and also educates farmers about evolving trends for better yields.
  • Nova Agritech imports and distributes specialized agricultural chemicals, like Butachlor and Emamectin Benzoate, to enhance productivity.
  • The company has experienced negative cash flows from operating, investing and financial activities in some of the periods during six months ended September 30, 2023 and Fiscals 2023, 2022 and 2021. In case of persistent negative cash flows, Nova Agritech's financial condition and operational capabilities could be impacted in the future.
  • Nova Agritech extends credit periods to its dealers, leading to an extended receivable cycle. Delays or defaults in payment by dealers can negatively impact the company's financial operations. The company's extended credit periods to dealers, aligning with crop cycles, resulted in high debtor days (203 days in NATL in FY 2022-23). Defaults or delays in dealer payments could strain the company's cash flow and profitability.
  • As of the latest disclosures, there are ongoing legal proceedings involving Nova Agritech, its subsidiaries, and directors. Adverse decisions in these litigations could result in financial liabilities and damage the company's reputation.
  • The company's contingent liabilities as of September 30, 2023, include corporate guarantees to banks (Rs. 8 crores) and capital commitments. These, if materialized, could adversely affect the company’s financial health.
  • Historical delays in regulatory filings, such as late filing of AOC-4 and MGT-7 forms, expose Nova Agritech to potential regulatory actions and financial penalties, impacting its compliance record and operational credibility.
  • Certain licenses of NASPL critical for the operation of Nova Agritech expired on December 31, 2023. Delays in renewing these licenses could temporarily halt business operations in certain jurisdictions, affecting the subsidiary's revenue streams.
  • Group companies like Nova Dairy Tech Private Limited and Nova Health Sciences Private Limited were previously struck off for non-filing of financial statements. Although currently active, these past defaults may still attract regulatory attention.
  • Nova Agritech's reliance on unsecured, demand-repayable loans from promoters and directors introduces financial vulnerability, as any sudden recall of these loans could destabilize the company's cash flow.
  • The per hectare pesticide consumption in India is significantly low (0.23 kg/hectare in FY 2023), much lower than the world average (2.6 kg/hectare) and that of countries like China (13 kg/hectare) and Japan (12 kg/hectare). This limited domestic market size poses a challenge to Nova Agritech's sales volumes and profitability, potentially restricting growth in the local market.

Financials

*All values are in Rs. Cr
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Application details

Apply asPrice bandApply upto
Regular39 - 41₹2 Lakh
High Networth Individual39 - 41₹2 - 5 Lakh
For Nova Agritech IPO, eligible investors can apply as Regular.
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