IPrOspecta • Curated IPO Analysis & Prospectus Audit
Hexagon Nutrition Limited
Listed
Mainboard
Healthcare & Clinical Nutrition
IPrOspecta Analysis
Researched by Tanish Vijayvargiya
Issue Structure & OFS vs Fresh Capital Split
| Offering Parameter / Tranche | Allocation & Value | % of Gross Issue | Strategic Mandate / Terms |
|---|---|---|---|
| Fresh Issue (Primary Growth Capital) | ₹150.00 Cr (Earmarked for debt reduction & plant automation) | 25.0% | Balance sheet equity expansion directly fueling capex, debt repayment & operations |
| Offer for Sale (OFS - Insiders) | ₹450.00 Cr (Promoters Arun Kelkar, Subhash Kelkar and Somerset Indus PE) | 75.0% | Secondary liquidity realization for existing promoters & early institutional funds |
| Gross Total Issue Size | ₹600.00 Cr | 100.0% | Aggregate primary market capital raising at upper price band |
| Net Proceeds Reaching Company | ₹138.50 Cr after issue expenses | - | Net growth funds after deducting book building issue & underwriting expenses |
| Anchor Investor Allocation Tranche | ₹180.00 Cr (30.0% of Issue) | Up to 30.0% | Reserved anchor allotment tranche for institutional Qualified Institutional Buyers (QIBs) |
| Pre-IPO WACA Benchmark | Promoter WACA: ₹0.45 per share; Somerset Indus WACA: ₹112.50 per share | Weighted average cost of acquisition for promoters & early funds | |
| Selling Shareholders & Dilution | Somerset Indus Healthcare Fund I (selling 7.2M shares), Promoters Arun Kelkar & Subhash Kelkar (selling 2.4M shares). | ||
| Intermediary / Regulatory Entity | Entity Name / Details | Statutory Function & Status |
|---|---|---|
| Book Running Lead Managers (BRLMs) | SEBI Registered Merchant Bankers / BRLMs | Issue pricing, underwriting, book building & institutional roadshows |
| Registrar to the Issue | SEBI Category-I Registrar | Allotment finalization, Demat share transfer & ASBA refund processing |
| Proposed Listing Exchanges | NSE / BSE | Trading segments, ticker assignment & continuous disclosure compliance |
| Regulatory Prospectus Stage | DRHP / RHP Filed | SEBI ICDR compliance review & exchange in-principle listing approval |
Revenue Breakdown, Product Mix & Customer Concentration
| Product / Operating Segment | Share (%) | Value / Channel |
|---|---|---|
Clinical Nutrition Formulations (PentaSure, Obesigo) | ₹188.10 Cr | |
Food Fortification Premixes (Humanitarian Programs) | ₹119.70 Cr | |
Therapeutic Micronutrient Supplements | ₹34.20 Cr |
| Market Segment / Customer Concentration Tier | Share (%) | Reported Value | Concentration & Risk Profile |
|---|---|---|---|
| Clinical Nutrition Formulations (PentaSure, Obesigo) | 55.0% | ₹188.10 Cr | High-margin therapeutic formulations |
| Food Fortification Premixes (Humanitarian Programs) | 35.0% | ₹119.70 Cr | Humanitarian fortification programs |
| Therapeutic Micronutrient Supplements | 10.0% | ₹34.20 Cr | B2C specialized supplements |
| Geographic Revenue Mix | Domestic: 58.0% | Exports: 42.0% | ₹198 Cr / ₹144 Cr | Institutional exports to 70+ countries |
| Top 1 Customer (UN WFP / Global Alliances) | 11.4% | ₹39.00 Cr | UN agency humanitarian supply contracts |
| Top 5 Customers | 34.2% | ₹117.00 Cr | Diversified institutional accounts |
Capital Allocation (Where the Fresh Money Goes)
| Object of the Offer / Proposed Expenditure | Amount (₹ Cr) | % of Fresh Issue | Deployment Timeline / Purpose |
|---|---|---|---|
| Automated Nashik Premix Plant Expansion Capex | ₹72.50 Cr | 48.3% | Automation, spray drying, cleanrooms |
| Debt Repayment & Borrowing Clearance | ₹35.00 Cr | 23.3% | Zero debt post-IPO |
| Incremental Export Receivables Working Capital | ₹15.00 Cr | 10.0% | Working capital for 70+ country exports |
| General Corporate Purposes (GCP) | ₹27.50 Cr | 18.4% | Marketing & general expenses |
| Total Fresh Growth Capital | ₹150.00 Cr | 100.0% | Balance Sheet Inflow |
3-Year Audited Financial Health & Margins
| Audited Metric / Line Item | FY23 | FY24 | FY25 | 3-Yr CAGR |
|---|---|---|---|---|
| Revenue from Operations | ₹248.50 Cr | ₹292.10 Cr | ₹342.00 Cr | +17.3% |
| EBITDA (Operating Profit) | ₹48.20 Cr (19.4%) | ₹61.30 Cr (21.0%) | ₹76.60 Cr (22.4%) | +26.1% |
| Profit After Tax (PAT) | ₹28.10 Cr (11.3%) | ₹37.50 Cr (12.8%) | ₹48.60 Cr (14.2%) | +31.5% |
| Operating Cash Flow (CFO) | ₹24.50 Cr | ₹36.20 Cr | ₹49.10 Cr | +41.6% |
| ROCE (Return on Capital) | 21.40% | 24.20% | 26.40% | 26.4% ROCE |
| Debt-to-Equity (D/E) | 0.45x | 0.32x | 0.08x | Near Zero |
Governance, Lock-in & Litigation Review
| Shareholder Category / Promoter Group | Pre-IPO Holding (%) | Post-IPO Holding (%) | Mandatory Lock-in Terms & Dilution |
|---|---|---|---|
| Promoters (Arun Kelkar, Subhash Kelkar & Family) | 68.40% | 53.80% | 20% locked for 18 Mos; balance 6 Mos |
| Private Equity (Somerset Indus Healthcare Fund) | 26.50% | 8.20% | Secondary OFS exit |
| Public & Institutional Allottees | 5.10% | 38.00% | Fresh + 75% OFS float |
| Litigation Category / Proceedings | Adjudicating Forum | Quantifiable Exposure | Materiality Assessment |
|---|---|---|---|
| Disputed Customs Duty Matters | CESTAT | ₹3.20 Cr | Import classification appeal under adjudication |
| Auditor IFCoFR Opinion | MSKA & Associates (BDO) | ₹0.00 Cr | Unmodified clean audit report |
1. Executive Business Summary & Core Operations
Hexagon Nutrition Limited is an established clinical nutrition and food fortification premix manufacturer serving healthcare and institutional humanitarian programs across 70+ countries with 22.4% EBITDA margins.
2. Value Proposition, Products & Operations
The company manufactures pure-play clinical nutrition formulations (PentaSure, Obesigo) and micronutrient fortification premixes for therapeutic care and public health programs.
3. Industry Dynamics & Market Positioning
The IPO consists of a Fresh Issue of ₹150 Cr for debt reduction and automated manufacturing in Nashik, alongside an OFS of ₹450 Cr by Somerset Indus PE and promoters.
4. Detailed Financial Trajectory & Margin Analysis
Audited restated financials demonstrate steady top-line growth (17.3% 3-Yr CAGR) with zero long-term debt post-IPO and FY25 ROCE of 26.4%.
5. Promoter Integrity, Governance & Shareholding
Promoters hold 68.4% equity pre-IPO with MSKA & Associates serving as statutory auditors with unmodified audit reports.
6. Relative Valuation & Benchmark Multiples
| Company Name | CMP / Issue Price (₹) | P/E Ratio (x) | EV / EBITDA (x) | RoNW / ROCE (%) | Annual Revenue (₹ Cr) |
|---|---|---|---|---|---|
| Hexagon Nutrition Limited | ₹45 | 32.4x | 16.2x | 26.4% | ₹342.00 Cr |
| Abbott India Limited | ₹28,500 | 52.4x | 36.8x | 36.5% | ₹5,850.00 Cr |
| Nestle India Limited (Healthcare Nutrition) | ₹2,400 | 74.2x | 48.5x | 88.0% | ₹19,100.00 Cr |
| Zydus Wellness Limited | ₹1,950 | 42.0x | 24.5x | 9.5% | ₹2,300.00 Cr |
| Healthcare Nutrition Composite | - | 56.2x | 36.6x | 44.7% | - |
At ₹45 per share, the issue is valued at ~32.4x FY25 P/E against healthcare and nutrition formulations peers.
Institutional Research & Regulatory Notice:
This document is a factual, data-driven synthesis of the Draft Red Herring Prospectus (DRHP) / Red Herring Prospectus (RHP) filed with SEBI and relevant stock exchanges. It does not constitute investment advice, financial promotion, or a recommendation to subscribe. Primary market investments carry market risk. Consult a SEBI-registered investment advisor before making allocation decisions.