Nova AgriTech IPO is an issue of Rs 143.81 crores. The issue is a combination of fresh issue of 2.73 crore shares aggregating to Rs 112.00 crore and offer for sale of 0.78 crore shares aggregating to Rs 31.81 crore. Nova Agritech is an agri-input manufacturer offering soil health management, crop nutrition and crop protection products focused on tech-based farmer-driven solutions.

About Nova AgriTech:

• Nova Agritech (NOVA) was incorporated in 9, 2007, at Hyderabad, with an objective to be a one-stop solution provider by offering ecologically sustainable and nutritionally balanced products to the farmers.
• NOVA is a an agri-input manufacturer offering soil health management, crop nutrition and crop protection products focused on tech-based farmer driven solution approach. 
• NOVA manufactures, distributes, and markets a wide range of product categories consisting of (a) soil health management products; (b) crop nutrition products; (c) bio stimulant products; (d) bio pesticide products (e) Integrated Pest Management products; (f) new technologies; and (g) crop protection products.
• The company entered pesticide business by acquiring stakes in Nova Agri Sciences Private Limited and ventured into area of seed enhancement by acquiring stakes in Nova Agri Seeds India Private Limited and making these companies its subsidiaries.
• The company has received a total of 720 product registrations comprising of 7 registrations in the soil health management category, 176 registrations in the crop nutrition category, 4 registrations in bio pesticide category, 7 registrations under Technical Indigenous Manufacture and 526 registrations in the crop protection category. Additionally, the company has applied for 36 registrations for new products across various categories. 
• NOVA’s distribution network is spread across 16 states comprising of approximately 11,722 dealers.
• Company’s manufacturing facilities are situated at Siddipet District, Telangana.
• NOVA provides farming inputs to farmers regarding the appropriate amount of dosage and application of the products through NOVA’s IOT based solutions such as the soil health scanning device called ‘NOVA BHUPARIKSHAK” and the drones called as ‘NOVA AGRIBOT’.  
• The promoters of the company are Suraksha Agri Retails (India) Private Limited, Yeluri Family Trust, Malathi S, and Kiran Kumar Atukuri.

Nova AgriTech IPO: Financials

Anchor: Nova AgriTech IPO

Nova AgriTech IPO: Salient Points

• Due to the IPO, promoter and promoter group shareholding will come down from 84.3% to 59.4 %.
• The Indian agricultural micro-nutrient market size was USD 538.4 million in 2021. Going forward, the market size is likely to grow at a CAGR of around 8%-10% by 2025.
• Besides presence in 16 states, the company also exports its products to Nepal and is awaiting the necessary permission to start business in Bangladesh, Sri Lanka and Vietnam through agreements with third parties in these regions. 
• Though, the business of the Company is spread across 16 states in India, most of the revenue comes from Telangana, Andhra Pradesh and Karnataka.
• NOVA plans to import and distribute Technicals, which it considers will play a vital role in the growth of the agriculture sector in India.
• Its subsidiary NASPL has entered into agreement for import and distribution of Technicals with a Taiwanese e entity, to act as the distributor for sales and formulation of Butachlor 85% Tech in India for a period of 5 years.
• NASPL has also entered into an agreement with a Chinese entity, to act as the distributor for sales and formulation of Emamectin Benzoate Technical 95% in India for a period of 5 years. 
• The company runs a farmer outreach program, Nova Kisan Seva Kendra program (NKSK), in order to educates farmers on various crop management practices. As on November 30, 2023, their team comprised 24 NKSK coordinators, who are agri graduates and were on the payrolls of the company.
• It has availed unsecured term loans from India Infoline Finance Limited, Shriram city union finance limited.
• Company intends to utilize a portion of Net Proceeds towards investment in their subsidiary, Nova Agri Sciences Private Limited for setting-up a new formulation plant and towards funding Capital Expenditure in our Company for expansion of existing formulation plant at Siddipet District, Telangana.
• Peers

• Nova AgriTech IPO is coming at a PE ratio of 18.5x (fy23 earnings) and 18.3x (fy24 annualized earnings).
• I intend to apply in Nova AgriTech IPO.. The company appears to be taking proactive approach to address need of farmers, is technology-driven, farmer-centric approach, offering suitable products.
• GMP as heard on Social Media may be around Rs.20.
• Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.