Sacheerome Limited IPO

Work (What They Do)

• Fragrances & Flavours Manufacturing
  Sacheerome is an India-based B2B company specializing in designing and manufacturing concentrated fragrances and flavours. Their products cater to a wide range of industries, including personal care, home care, beverages, bakery, confectionery, dairy, health & nutrition, and more. Their client base includes both domestic leaders in FMCG and international customers across the Middle East (UAE) and Africa
• R&D-driven Operations
  They boast a dedicated R&D facility staffed with around 54 specialists, supported by advanced QC labs and robotic production systems. This enables the company to innovate products like emulsion, encapsulated flavours, and enhanced fragrance delivery technologies (e.g., “Sach/Maxicaps,” “Sach/Veda”)
• Growth Strategy via IPO
  Sacheerome’s recent SME IPO (June 9–11, 2025) intends to raise ₹61.62 crore. Proceeds will finance a new manufacturing plant in Gautam Buddha Nagar, Uttar Pradesh, and support general corporate requirements. The listing is scheduled for June 16, 2025, on the NSE SME platform

✅ Strengths

1. Strong Financial Growth & Profitability
   • FY 25 revenue rose ~25% YoY to ₹108 crore; PAT nearly doubled (~50%) to ₹16 crore
   • EBITDA margin around 20%, PAT margin near 14%; ROE ~26%, ROCE ~33%—above industry norms
   • Value-generating balance sheet: low debt, growing net worth ~₹53 cr; strong cash flows from operations .
2. Efficient Operations & Experienced Team
   • Almost debt-free with efficient working capital management (cash conversion cycle dropped from 84 to ~36 days)
   • Founders and leadership have decades of experience; the company exhibits strong sales, marketing, and raw-material sourcing capabilities
3. Scalable R&D and Manufacturing Capabilities
   • Advanced R&D center with innovation-led delivery solutions and automated production improves product differentiation
   • Expansion plans include a new facility in UP to boost production—heightening capacity and geographic reach.

Risks & Challenges

• Customer Concentration
  Roughly half of revenue comes from the top 5 customers. This reliance means losing any major client could significantly impact revenues
• Geographic Dependency
  Significant business originates in Uttar Pradesh and Maharashtra, exposing the firm to regional economic fluctuations
• Industry Competition & Market Structure
  The flavours & fragrances sector is highly fragmented and competitive, with larger players (e.g., S H Kelkar) potentially eroding margins. Additionally, heavy dependency on the fragrance segment (90%+ of revenue) may pose risks if demand shifts
• Raw Material & Regulatory Risks
  Volatile raw material prices and dependence on select suppliers could pressure margins. Moreover, stricter regulations in food and cosmetics might escalate compliance costs and impact operations

Conclusion:
Sacheerome Limited presents a compelling growth story backed by solid financial performance, operational strength, and strategic expansion. However, investors should weigh risks like client concentration, geographic dependency, and industry competition. The upcoming IPO on June 16, 2025, offers an entry point—subject to investor risk appetite and vision for long-term earnings stability.