Neogen Chemical board approves issuing 16 lakh shares at 1,402.12/share via preferential issue

News: Neogen chemical’s board has decided to Issue up to 16.04 lakh equity shares of face value of Rs.10 each at a price of Rs.1,402.12 per equity share aggregating up to Rs.225 crore on preferential basis. The group of investors remain SBI MF, Axis MF, Plutus wealth and White oak.

Views: The company decided to foray into lithium electrolyte last quarter. We expect part of this proceed can be allocated towards this venture. Further, it has also been witnessing decent traction in custom synthesis and thus prudent capital allocation towards high ROCE generating business to improve group return ratios in medium to long run.

Impact: Positive