CARE assigns "IPO Grade 4" to Jyothy Laboratories

MUMBAI: CARE has assigned the proposed initial public offer of Jyothy Laboratories Ltd Grade 4, which indicates above average fundamentals.

Jyothy Laboratories is planning an IPO of 4,430,260 equity shares of face value of Rs.5 each.

The grading draws strength from the track record of the promoters, participation of private equity investors, high market share of flagship product -Ujala fabric whitener, and healthy financial position of the company. The grading also takes into account Jyothy Laboratories’ focus on regional markets, strong distribution network and reasonably priced products.

The grading is, however, constrained by a small product portfolio at the national-level, highly competitive nature of the industry in which the company operates and moderate governance structure of the company.

Over the years, the company has evolved from a single-product proprietary firm into a multi-brand company involved in the manufacturing and marketing of fabric whiteners, mosquito coils, soaps, detergents and incense sticks. The company has attracted investments by various well-known private equity investors like Baring India Investment, CDC Financial services, CLSA and ICICI Bank Canada and UK.


Jyothy Laboratories largely operates in the 'Home Care' segment of the FMCG industry. Recently, the company diversified into the 'Personal Care' segment.

The company has 21 manufacturing facilities, spread over 14 different locations all over India, eight of which are in tax efficient locations.

Jyothy Laboratories’ net sales has grown at a compound annual growth rate of over 5 per cent in the past three financial years ended June 2006. Growth in sales was mainly driven by its flagship product -Ujala whose sales have grown at a CAGR of 12 per cent