Vipul Organics sets THIS as record date for rights issue; shares surge over 6%

Shares of Vipul Organics surged over 6.5 percent in intra-day trade on March 5, 2025, after the company announced March 10, 2025, as the record date for its upcoming rights issue. The stock touched an intra-day high of ₹204.50, marking an upward movement following the announcement.

Rights Issue Details

Vipul Organics has set the issue opening date as March 21, 2025, with the subscription closing on April 2, 2025. The company has revised the issue price to ₹46 per share, lowering it from the previously announced ₹54 per share, citing current market conditions and investor interest. The total issue size has been pegged at ₹20.41 crore.

Vipul Shah, Managing Director of Vipul Organics, expressed optimism about the company’s future, emphasizing the strategic importance of the upcoming fundraise. “We are excited about our journey ahead and see a bright future for our company. The construction of our new Sayakha plant in Gujarat is progressing as per schedule, and we expect to begin trial runs in Q3 FY26. Our shareholders are our biggest strength, and in light of current market conditions, we have revised the price of the rights issue to ₹46 per share to reward our stakeholders,” he stated.

The proceeds from the rights issue will be directed towards the development of the Sayakha facility, which is expected to commence production in phases from Q1 FY26. The new plant will focus on manufacturing pigments, pigment intermediates, and high-performance colors, aligning with Vipul Organics’ long-term growth strategy.

The company, in its FY24 annual report, highlighted that with the establishment of the Sayakha facility, Vipul Organics aims to become a global leader in pigment and colorant manufacturing, competing with some of the largest global capacities outside China. Over the past few years, the company has undertaken extensive cost optimization measures and product portfolio enhancements, with the Sayakha plant marking a key milestone in this journey.

Financial Performance

Vipul Organics reported an 81.57 percent year-on-year increase in consolidated net profit, reaching ₹144.95 lakh in Q3 FY25. The profit growth was attributed to operational efficiencies stemming from backward integration initiatives.

The company’s revenue for the third quarter ended December 31, 2024, stood at ₹4,153.68 lakh, reflecting a 10.44 percent growth compared to the same quarter last year. For the nine-month period ending December 2024, net profit surged 60.55 percent to ₹364.33 lakh, while revenue increased 7.89 percent to ₹11,916.75 lakh.

On a quarter-on-quarter basis, revenue grew from ₹3,943.12 lakh in Q2 to ₹4,153.68 lakh in Q3 FY25, while net profit rose from ₹105.94 lakh to ₹144.95 lakh.

Vipul Shah, MD of Vipul Organics, noted that despite geopolitical volatility, the company managed steady revenue growth, supported by backward integration and cost-efficiency measures. The company operates three manufacturing facilities in Maharashtra and exports its products to over 50 countries. It reported FY24 revenues of ₹151 crore.

Stock Price Performance

Vipul Organics’ stock jumped 6.6 percent to a day’s high of ₹204.50 on March 5. However, it remains 38 percent below its peak of ₹329.40, which was hit in October 2024. At the same time, the stock has rebounded 46 percent from its 52-week low of ₹140, recorded in June 2024.

The recent rally comes after a prolonged four-month decline. The stock had dropped 14 percent in February, 8 percent in January, 3 percent in December, and 8 percent in November. Despite the short-term gains, the stock has lost over 4 percent in the past year.

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