Gandhar Oil Refinery India IPO Review: Gandhar Oil Refinery India Limited is coming up with its Initial Public Offering. The IPO will open for subscription on November 22, 2023 and close on November 24, 2023. In this article, we will look at the Gandhar Oil Refinery IPO Review 2023 and analyze its strengths and weaknesses. Keep reading to find out!

Gandhar Oil Refinery IPO Review – About The Company

Gandhar Oil Refinery India is the leading manufacturer of white oils in terms of revenue with a growing focus on the consumer and healthcare industries.

As of June 2022, the company offers a wide over 350 products that primarily fall under three categories – personal care, lubricants, healthcare and performance oils (PHPO), and process and insulating oils (PIO) – under the brand name “Divyol”.

The company’s products are used by top Indian and global companies as crucial ingredients for diverse end products in areas such as consumer goods, healthcare, automotive, industrial, power, tyres, and rubber.

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As of June 2022, the company has served 100 nations worldwide. Procter & Gamble (“P&G”), Unilever, Marico, Dabur, Encube, Patanjali Ayurved, Bajaj Consumer Care, Emami, and Amrutanjan Healthcare were among the more than 3500 clients carried out by the company.

Gandhar Oil Refinery IPO Review – Industry Overview

According to estimates, the global specialty oil market, which was valued at $125.99 billion in 2022, is projected to grow at a CAGR of 3.4% and reach $148.7 billion by 2027. Similarly, the Indian specialty oil market is expected to rise from $7.0 billion in 2022 to $8.85 billion by 2027, registering a CAGR of 4.7%.

The white oil segment, which is the fastest-growing category in the Indian specialty oil market, is expected to be worth $0.43 billion in 2022 and reach $0.69 billion by 2027, growing at a CAGR of 9.8%. The volume of this segment is expected to reach 1,128 KT by 2027 from 718 KT in 2022, registering a CAGR of 9.5%. Personal care and cosmetics are among the fastest-growing categories in this segment.

The white oil market is expected to be driven by increased demand for cosmetics and a better standard of life. The pharmaceutical industry is also expanding. The primary drivers of the Indian pharmaceutical market are government efforts such as the PLI plan, expertise in low-cost generic patented medications, quality service at a low cost compared to the US, Europe, and others, and strong domestic demand. 

Gandhar Oil Refinery IPO Review – Financial Highlights

If we look at the financials of Gandhar Oil Refinery we can find out that its revenue has grown from ₹1512.74 crores in March 2020 to ₹3389.07 crores in March 2022. Its profits have grown from ₹47.23 crores in March 2020 to ₹184.14 crores in March 2022.

This increase in revenue and net profit numbers is accompanied by an improvement in net profit margins from 3.11% in FY20 to 5.42% in FY22.

Coming to the return ratios, we can see that, it has an exceptional ROE of 39.36% and a RoCE of 46.99% as of FY23. This indicates an exceptional return on the capital invested by the shareholders and an optimum use of company resources.

In FY23, the company has reported a revenue of ₹8,839.37 crores and a net profit of ₹65.01 crores. This gives it a net profit margin of 7.34%.

Financial Metrics 

Gandhar Oil Refinery IPO Review - Financials Chart
(Source: RHP of the company)


The following table image shows the comparison of Gandhar Oil Refinery along with its listed peers:

Competitors of Gandhar Oil Refinary
(Source: RHP of the company)

Strengths of the Company

  • The company is one of the largest manufacturers of white oils by revenue domestic and overseas in FY22. It was also one of the top five players globally in terms of market share in 2021.
  • The company has established long-term relationships with some leading consumers and pharma manufacturers with its ability to offer customized products. As of FY22, it has catered to 3529 Indian and global customers
  • The company has strategically set up three manufacturing facilities, 2 located in western India and one located in UEA which helps it cater to its Indian and global operations
  • The nature of the industry as well as the stringent quality standards applicable to various products in the end-industries to which the company caters. This makes it difficult for new entrants to replicate our quality, scale and business operations. 
  • The company is managed by a skilled and knowledgeable management team with experience and knowledge of the specialty oils sector, including administration, marketing, and human resource management.

Weaknesses of the Company

  • The company conducts a significant portion of its business primarily through USD or through several other currencies. Thus, it is exposed to exchange rate fluctuations that can negatively impact its business.
  • The company receives a significant portion of its revenue from a limited number of suppliers. As the company does not have any long-term contracts with its suppliers, a disruption in the supply of raw materials by any of its suppliers can significantly impact its business.
  • The company requires huge working capital to run its operations. A disruption of such cash flow can significantly impact the operations of the business
  • The company does not have any long-term agreements with its customers. A loss of any of its customers or a reduction in the order by them can significantly impact its business.
  • The company relies on it to transport its raw materials and final products. Any disruption caused in the supply can negatively impact its business.

Gandhar Oil Refinery IPO Review – GMP

The shares of Gandhar Oil Refinery India traded at a premium of 29.59% in the grey market on November 17th, 2023. The shares tarded at Rs 219. This gives it a premium of Rs 50 per share over the cap price of Rs 169.

Gandhar Oil Refinery IPO Review – Key IPO Information

IPO Size₹500.00 Cr
Fresh Issue₹357.00 Cr
Offer for Sale (OFS)₹143.00 Cr
Opening dateNovember 22, 2023
Closing dateNovember 24, 2023
Face Value₹2 per share
Price Band₹160 to ₹169 per share
Lot Size88 shares
Minimum Lot Size1
Maximum Lot Size13 (1144 shares)
Listing DateDecember 5, 2023

Promoters: Mr Ramesh Babulal Parekh, Mr Samir Ramesh Parekh and Mr Aslesh Ramesh Parekh

Book Running Lead Manager: Edelweiss Financial Services Limited and ICICI Securities Limited

Registrar to the Offer: Link Intime India Private Limited

The Objective of the Issue

The net proceeds from this issue will be utilized for the following purposes:

1)  Loan investment in Texol to finance the repayment/prepayment of a loan facility obtained by Texol from the Bank of Baroda.

2) Capital expenditure through the purchase of equipment and civil work required for:

  • Expansion in the capacity of automotive oil at Silvassa Plant 
  • Expansion in the capacity of petroleum jelly and accompanying cosmetic product division at Taloja Plant; 
  • Expansion in the capacity of white oils by installing blending tanks at Taloja Plant

3) Funding company’s working capital requirements

In Closing

In this article, we examined the details of the Gandhar Oil Refinery India IPO Review 2023. Given the difficulty of the industry for new players coupled with the company’s strong foothold, its outlook appears favorable for the future. 

What do think the future holds for the company? Are you applying for the IPO? Let us know in the comments below.

Written by Aaron Vas

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