Neochem Bio Solutions
- Neochem Bio Solutions is coming out with an initial public offering (IPO) of 45,88,800 shares in a price band of Rs 93-98 per equity share.
- The issue will open on December 02, 2025 and will close on December 04, 2025.
- The shares will be listed on SME Platform of NSE.
- The face value of the share is Rs 10 and is priced 9.30 times of its face value on the lower side and 9.80 times on the higher side.
- Book running lead manager to the issue is Vivro Financial Services.
- Compliance Officer for the issue is Shradha Sarthak Agrawal.
Profile of the company
Neochem Bio Solutions is a specialty performance chemical company with a legacy of over four decades, engaged in the business of manufacturing specialty performance chemicals with a diverse portfolio of over 350 customized formulations across four primary product segments viz., (i) Polymers, (ii) Surfactants, (iii) Silicones, and (iv) Esters & bio-based sustainable solutions. Its products are essential and used in industries such as textile & garment washing, home & personal care (HPC), institutional and industrial cleaners, water treatment, paints and coatings, paper and pulp, construction, rubber and dyes and pigments. The company is accredited with recognized process certifications such as ISO 9001:2015, ISO 14001 and ISO 45001. Its product certifications include ZDHC Level 3 and GOTS 7.0.
It offers a comprehensive range of textile and garment washing auxiliaries such as pre-treatment, dyeing, finishing, printing and coating applications across all fabric and garment substrates compatible with various processing machines. It manufactures and supplies a diverse range of specialty performance chemicals such as dispersant polymers, anti-foams, specialty surfactants, silicone emulsions, and rheological modifiers for the home and personal care industries. Its water treatment range includes anti-scalant formulations based on high and low molecular weight polymers, along with dispersants, anti-foams, de-colorants and flocculants. For the paint and coating industry, it offers acrylic dispersants, wax emulsion-based additives, anti-foams, and acrylic emulsions. Further, its institutional and industrial cleaning range includes room care, laundry care, kitchen hygiene, and personal hygiene solutions tailored for commercial and industrial use.
The company’s manufacturing facility is located at Saket Industrial Estate, Village Moraiya, Ta. Sanand, Dist-Ahmedabad, which has an installed capacity of 22,000 metric ton per annum (MTPA) with a total area of 6,763 square meters. This facility is partially automated and designed for production of small to medium batches with the capability to handle both liquid and powder-based chemistries. The facility is supported by warehousing capacity to store approximately 1,350MT of raw materials and finished goods at a time. Its formulation and product application development initiatives are supported by a dedicated in-house research & development laboratory, and an application research center equipped with advanced testing capabilities and operated by a team of qualified professional including support staff. Its initiatives are directed towards advancing sustainability through the development of bio-based products tailored to meet specific customer requirements.
Proceed is being used for:
- Funding the long-term working capital requirements of the company
- Repayment/prepayment, in full or part, of all or certain outstanding borrowings availed by the company
- General corporate purposes
Industry Overview
India’s domestic chemicals industry has exhibited consistent and robust growth over recent years, reflecting its pivotal role in supporting the country's industrialization and consumption-driven economy. From a market size of Rs 12 lakh crores in FY19, the sector expanded to approximately Rs 23 lakh crore in FY24, clocking a CAGR of around 9.3%. This momentum is expected to continue with the market likely to surpass Rs 26 lakh crores by FY25. The sector’s growth is underpinned by rising domestic demand across end-use industries such as agriculture, pharmaceuticals, textiles, automotive, and construction. India’s strategic shift towards import substitution, enhanced focus on manufacturing under the 'Make in India' initiative, and increased investments in R&D and specialty chemicals have further strengthened the sector’s trajectory. Moreover, tightening global environmental norms have led to a shift in manufacturing from China to India, positioning the country as an emerging global hub for chemical production. This is complemented by a well-established value chain, cost competitiveness, and growing domestic consumption, especially in specialty and performance chemicals.
Textile chemicals are critical inputs used throughout the textile manufacturing process to impart specific properties and enhance performance. These chemicals play diverse roles, including preparing raw fibers through pre-treatment agents, enabling coloration through dyeing and printing auxiliaries, and adding functional attributes via finishing agents such as wrinkle resistance, water repellency, flame retardancy, and antimicrobial properties. Additionally, various textile auxiliaries improve process efficiency and final product quality. Their applications span across apparel, home textiles, and technical textiles, including sportswear, medical fabrics, and industrial materials, making them a cornerstone of the global textile value chain.
The global textile chemicals market has shown a fluctuating but overall upward trend over recent years. In 2019, the market stood at $32.4 billion but saw a sharp contraction to $23.8 billion in 2020, likely due to pandemic-driven disruptions in production, supply chains, and demand. However, the industry recovered swiftly, reaching $30.1 billion in 2021 and growing further to $38.8 billion in 2022 and $41.5 billion in 2023. By 2024, the market reached $52.4 billion, reflecting a CAGR of around 10% from 2019 to 2024. Looking ahead, the market is projected to expand at a CAGR of 10-12%, reaching $87.4 billion by 2029. This growth is expected to be driven by rising demand for functional and sustainable textiles, increased urbanization, evolving fashion trends, and technological advancements in chemical formulations that align with stricter environmental regulations.
Pros and strengths
Integrated and flexible manufacturing operations: The company operates an integrated manufacturing facility that enables it to produce key intermediates in-house and develop proprietary formulations for diverse customer requirements. Its manufacturing facility at Moraiya, Ahmedabad, is equipped to handle multiple chemistries such as polymer based acrylic dispersants formulation, bio-based esters and silicone based formulations and products based on surfactant chemistry which supports intermediate manufacturing and formulation processes. A significant portion of its total production is derived from intermediate manufacturing operations, with a substantial share utilised internally in downstream formulations. This integrated structure allows it to exercise greater control over input quality, manage production costs efficiently and ensure supply chain reliability which are important for specialty performance chemicals that require consistent quality and performance standards.
Strong understanding of applied chemistries for diverse end-use industries: With over four decades of operational experience and technically qualified team, it has developed strong application and process knowledge across a wide range of industries such as textiles and garment washing, home and personal care, industrial and institutional cleaning, construction chemicals, paint and coatings, water treatment, paper and pulp, rubber, and dyes and pigments. Its understanding of customer-specific product requirements, combined with its formulation capabilities, enables it to deliver specialty performance chemicals that meet functional, regulatory and quality standards across diverse industrial applications. Its product portfolio includes more than 350 customized formulations, classified under four primary product segments such as polymers, surfactants, silicones, esters and bio-based sustainable solutions which are used to meet industry specific requirements.
Strong research and development capabilities: The company has technical capabilities that enable the development of environmentally sustainable chemical solutions, tailored to evolving customer requirements. Its in-house R&D and product application development laboratory located at its manufacturing facility in Moraiya, Ahmedabad, is equipped with advanced testing and formulation infrastructure and operated by a team of qualified professionals including support staff. Its technical initiatives focus on three core areas: (i) formulation development based on customer-specific application requirements, (ii) process optimization to reduce energy consumption and effluent generation and (iii) innovation and development of bio-based alternatives to conventional synthetic chemistries. As a result, the company has developed its range of green essentials (Sustainable ATMOS series) which are bio-based formulations which include plant-based/plant derived products.
Risks and concerns
Heavy reliance on textile segment for growth: The company derives a substantial portion of its revenue from the textile industry. The revenue generated from the sale of textile specialty performance chemical products constituted approximately 77.03%, 85.24%, 90.75%, and 95.92%, respectively, of its total revenue from operations for the six months period ended September 30, 2025 and Financial years ended March 31, 2025, March 31, 2024 and March 31, 2023. Consequently, any material decline in the performance of the textile sector, or its failure to sustain, grow, or efficiently manage its sales within this sector, may materially and adversely affect its business operations, financial condition and results of operations.
Vulnerability due to non-contractual customer relationships: The company generally does not enter into firm, long-term supply agreements with the majority of its customers. Instead, its sales are typically governed by short-term purchase orders, which specify the unit price, delivery schedule, and quantity of products to be supplied. These purchase orders are subject to amendment or cancellation prior to final confirmation. As a result, the loss of one or more key customers, or any significant reduction in their demand for its products, could materially and adversely affect its business operations, financial condition, results of operations and cash flows.
Supplier concentration risk without firm contracts: The company is dependent on third party suppliers for the procurement of raw materials, however, it has not entered into any long-term supply arrangement or agreement for the same. The company has procured 48.21%, 57.01% and 50.63% of its total raw material from top 10 suppliers in FY25, FY24 and FY23 respectively. If it fails to successfully leverage its existing and new relationships with suppliers, its business and financial performance could be adversely affected.
Outlook
Neochem Bio Solutions is engaged in the business of manufacturing of specialty performance chemicals. The company products are essential and used in industries such as textile & garment washing, home & personal care (HPC), institutional and industrial cleaners, water treatment, paints and coatings, paper and pulp, construction, rubber and dyes and pigments. The company has leveraged existing strategic collaborations and partnerships to diversify end user industries. The company is strengthening the presence across end-user application industries. On the concern side, the company derives a substantial portion of its revenue from the textile industry. Consequently, any material decline in the performance of the textile sector, or its failure to sustain, grow, or efficiently manage its sales within this sector, may materially and adversely affect its business operations, financial condition and results of operations. Moreover, the company has not made any long-term supply arrangement or agreement with its suppliers. In an eventuality where its suppliers are unable to deliver it the required materials, at a competitive price, in a time-bound manner it may have a material adverse effect on its business operations and profitability.
The company is coming out with a maiden IPO of 45,88,800 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 93-98 per equity share. The aggregate size of the offer is around Rs 42.68 crore to Rs 44.97 crore based on lower and upper price band respectively. On performance front, the company has reported 37.66% rise in revenue from operations at Rs 8,417.27 lakh in FY25 as compared to Rs 6,114.63 lakh in FY24. Moreover, the company’s net profit soared 4-fold to Rs 775.07 lakh in FY25 as compared to Rs 180.13 lakh in FY24.
Innovation is a driver of its growth strategy, with a dedicated focus towards the development of differentiated, high-performance and sustainable chemical solutions. Its dedicated in-house R&D and product application development team, comprising qualified professionals including support staff, works closely with customers to develop customized formulations that address specific application requirements while simultaneously enhancing environmental and operational efficiency. It is engaged in advancing bio-based alternatives to conventional synthetic chemicals, with the objective of reducing environmental impact and improving product lifecycle performance. Several of its bio-based chemical formulations include plant-based softeners, phosphorus-free chelating agents and glucose-derived surfactants, which are aimed at reducing the carbon footprint and improving the lifecycle performance of customer products.
