UNISEM AGRITECH LIMITED IPO Explain

Unisem Agritech IPO Overview

Haveri (Karnataka)-based hybrid seeds manufacturer raising ₹21.45 cr (100% fresh issue). Price: ₹63-65. Lot: 4,000 shares (₹2.60L min).

Funds for working capital, debt repayment, general corporate purposes.

Lead: GetFive Advisors.

Anchor raised ₹9.36 cr.

Founded 2016, 8+ years operations, 20+ years promoter experience.

Develops, processes, sells hybrid seeds for vegetables (tomato, chilli, okra, brinjal, cucurbits), flowers, field crops. 873.75 sq.m seed processing unit & warehouse in Ranebennur. 27.25 acres R&D farms. 5 breeders, 52 support staff. Competes with Kaveri Seeds, Advanta, Bayer, Mahyco, Nuziveedu, Syngenta, VNR Seeds.

IPO DETAILED INFORMATION

Issue Details

Parameter	Details
IPO Type	SME
IPO Open Date	10 December 2025 (Tuesday)
IPO Close Date	12 December 2025 (Thursday)
Anchor Investor Bidding	09 December 2025 (Monday) – Raised ₹9.36 crore (maximum anchor allocation)
Allotment Date	15 December 2025 (Sunday) – Expected
Credit to Demat	16 December 2025 (Monday) – Expected
Refund Initiation	16 December 2025 (Monday) – Expected
Listing Date	17 December 2025 (Tuesday) – Tentative
Price Band	₹63 – ₹65 per share
Face Value	₹5 per share
Lot Size	2,000 shares (minimum lot); multiples of 2,000 thereafter
Min Investment (Retail)	₹2,60,000 (4,000 shares = 2 lots at upper band ₹65)
HNI Investment	₹3,90,000 (6,000 shares = 3 lots) minimum
Issue Size	₹21.45 crore total
Fresh Issue	₹21.45 crore (100%) – 33,00,000 equity shares
Offer for Sale (OFS)	NIL – No OFS component
Total Shares Offered	33,00,000 equity shares
Listing	BSE SME (Emerge Platform)
Post-Issue Market Cap	Estimated ~₹96-100 crore (at upper price band ₹65)
Anchor Funding	₹9.36 crore raised from anchor investors on December 9, 2025 (9,36,000 shares)

Issue Break-up

Category	Allocation
Anchor Portion	9,36,000 Equity Shares (maximum allocated)
QIB (Net of Anchor)	6,24,000 Equity Shares (18.60% of Net Offer after anchor)
NII (Non-Institutional Investors)	4,72,000 Equity Shares (not less than 15% of Net Offer)
Retail Individual Investors	11,00,000 Equity Shares (not less than 35% of Net Offer)
Market Maker	1,68,000 Equity Shares

Selling Shareholders (OFS)

No Offer for Sale (OFS) – Entire issue is 100% fresh capital infusion for company growth. No promoter or investor exits.

Note: Promoter H. N. Devakumar and family retain 100% pre-IPO ownership; post-IPO shareholding will reduce due to dilution from fresh issue only.

Objects of the Issue (Fund Utilization)

Fresh Issue Proceeds (₹21.45 crore) will be used for:

1. Funding Working Capital Requirements – Largest Allocation
   • Raw material procurement (foundation seeds, breeder seeds, parent seeds)
   • Inventory financing for finished seeds and work-in-progress
   • Payments to contract growers and seed multiplication network
   • Operational expenses including R&D costs, salaries, utilities
   • Support for order fulfillment and seasonal inventory build-up (seeds are seasonal business with harvest-to-sowing cycles)
2. Repayment/Prepayment of Banking Facilities
   • Repayment of bank loans and financial institution borrowings
   • Reduction of interest burden on balance sheet
   • Improving financial flexibility and credit profile
   • Strengthening debt-equity ratio for future growth
3. General Corporate Purposes
   • R&D enhancement and new hybrid variety development
   • Marketing and brand building initiatives
   • Distribution network expansion (dealers, retailers, direct farmer outreach)
   • Technology infrastructure and ERP systems
   • Business development and market expansion
   • Contingency reserves for unforeseen requirements

Strategic Focus:

• Strengthen working capital to support seasonal seed business (procurement, processing, inventory holding)
• Reduce debt burden and interest costs for improved profitability
• Scale R&D capabilities for continuous hybrid seed development
• Expand distribution network to reach more farmers across diverse agro-climatic zones

Note: 100% fresh issue indicates genuine growth capital requirement, no investor/promoter exits. Positive indicator of expansion intent and promoter confidence (Chairman H. N. Devakumar committed to long-term growth).

Lead Managers & Registrar

Book Running Lead Manager (BRLM):

• GetFive Advisors Private Limited
  • Address: 502, Abhishree Avenue, Nehrunagar, Manekbag, Ahmedabad, Gujarat – 380015
  • Phone: +91 7990729901
  • Website: www.getfive.in

Registrar:

• Kfin Technologies Limited
  • Address: Selenium Tower – B, Plot 31 & 32, Gachibowli, Financial District, Nanakramguda, Serilingampally, Hyderabad – 500032, Telangana
  • Phone: +91 40 6716 2222, +91 40 7961 1000
  • Email: [email protected]
  • Website: www.kfintech.com / https://ipostatus.kfintech.com/

Market Maker:

• To be appointed as per SEBI SME regulations

Promoters & Management

Key Promoter:

H. N. Devakumar – Chairman, Managing Director & Promoter

• Founder and visionary leader of Unisem Agritech Limited
• 20+ years of collective promoter expertise in seed industry and agriculture
• Deep domain knowledge in hybrid seed development, conventional breeding, seed production
• Strategic leadership driving R&D, operations, market expansion
• Agronomic focus and farmer-centric approach to product development

Management Team:

• 5 Breeders: Dedicated research team for hybrid variety development across vegetables, flowers, field crops
• 52 Supporting Employees: R&D support staff, production personnel, quality control, sales & marketing, administration
• Total Employee Strength: 57+ employees as of company disclosures
• Research Infrastructure: 27.25 acres of leased farmland for R&D trials, laboratory facilities

Company History:

• Incorporated: 2016 (8+ years of operations as Unisem Agritech Limited)
• Promoter Legacy: 20+ years of collective promoter experience in agriculture and seed industry prior to incorporation
• Vision: Build integrated seed value chain combining R&D excellence with modern processing infrastructure to deliver superior hybrid seeds
• Mission: Commitment to agronomic quality, consistency, and farmer-centric delivery
• Growth Milestone: Scaled from startup to ₹69 cr revenue with profitability, established R&D capabilities, processing infrastructure, pan-India distribution

Certifications & Quality:

• Stringent quality checks and testing protocols for all seed products
• Compliance with national seed certification standards
• Focus on genetic purity, germination rates, physical purity, moisture content

Company Contact:

• Registered Office: RS No. 11B/2A/4, Magoda Village, Near KSRTC Bus Depot, Haveri, Karnataka – 581115, India
• Seed Processing Unit & Warehouse: 873.75 sq.m facility in Ranebennur, Karnataka
• R&D Farms: 27.25 acres leased farmland
• Phone: +91 9141031113
• Email: [email protected]
• Website: www.unisem.in

COMPANY OVERVIEW

Establishment & Background:

• Founded: 2016 (8+ years of operations; promoter has 20+ years industry experience)
• Industry: Hybrid Seed Development, Processing & Marketing – Agricultural Biotechnology (Conventional Breeding)
• Headquarters: Haveri, Karnataka
• Operations: Seed processing & warehousing in Ranebennur, Karnataka; R&D farms on 27.25 acres leased land
• Positioning: Integrated seed value chain company from breeder seed development to commercial seed sales

Business Model:

Product Portfolio – Hybrid Seeds Across Three Categories:

1. Vegetable Seeds (Primary Business Line)

• Solanaceous Crops: Tomato, Chilli (Hot Pepper), Brinjal (Eggplant), Capsicum (Bell Pepper)
• Cucurbits: Bottle Gourd, Ridge Gourd, Bitter Gourd, Cucumber, Watermelon, Muskmelon
• Other Vegetables: Okra (Bhindi), Cluster Beans, French Beans
• Target Customers: Commercial vegetable farmers, kitchen gardeners, horticulture enterprises

2. Flower Seeds

• Hybrid flower varieties for ornamental and commercial floriculture
• Marigold, Celosia, other decorative flowers
• Target Customers: Floriculture farmers, nurseries, landscaping companies

3. Field Crop Seeds

• Hybrid varieties for major field crops (specific crops not fully disclosed – likely cotton, maize, sorghum, millets)
• Target Customers: Large-scale farmers, agribusinesses

Integrated Seed Value Chain – “Breeder to Farmer” Model:

Stage 1: Breeder Seed Development (R&D)

• In-house team of 5 breeders conducting conventional breeding programs
• Parent line development and maintenance
• Trait selection: High yield, pest resistance, disease resistance, stress tolerance, quality enhancement
• 27.25 acres of dedicated R&D farms for trials and seed production
• Laboratory facilities for genetic evaluation

Stage 2: Foundation Seed Production

• Selection of high-quality traits from breeder seeds
• Foundation seed multiplication under controlled conditions
• Genetic purity maintenance

Stage 3: Commercial Seed Multiplication

• Contract with network of seed growers for large-scale multiplication
• Supervision and quality control during multiplication
• Hybrid seed production through controlled pollination (for vegetables, flowers)

Stage 4: Seed Processing & Quality Assurance

• 873.75 sq.m modern seed processing unit in Ranebennur, Karnataka
• Cleaning, grading, treating, packaging of seeds
• Stringent quality checks: Germination testing, physical purity, genetic purity, moisture content
• Warehouse facility for inventory storage

Stage 5: Distribution & Sales

• Pan-India distribution through dealers, retailers, and direct farmer outreach
• Sales across multiple states covering diverse agro-climatic zones
• Focus on farmer education and agronomic support

Revenue Model:

• B2B & B2C sales of certified hybrid seeds
• Pricing based on variety, quality, market positioning
• Seasonal revenue patterns aligned with sowing seasons (Kharif, Rabi)

Value Proposition:

• Consistency in Yield: Hybrid seeds deliver predictable high yields vs traditional/local varieties
• Pest & Disease Resistance: Genetic traits reduce crop losses and pesticide costs
• Quality & Purity: Stringent testing ensures high germination rates and genetic fidelity
• Farmer-Centric: Product development aligned with diverse agro-climatic conditions and farmer needs
• Agronomic Support: Technical guidance and crop management advice to farmers

Market Position:

• Emerging Player: Growing presence in India’s hybrid seed market (₹20,000+ crore vegetable seed market)
• 8+ Years Track Record: Established operations since 2016 with revenue growth to ₹69 cr in FY25
• R&D-Driven: 5 breeders, 52 support staff, 27.25 acres dedicated to research – demonstrating innovation focus
• Regional Strength: Strong base in Karnataka with expansion across India
• Integrated Model: Complete seed value chain from breeding to processing – few players have this integration at SME scale

Operations:

Manufacturing & Processing:

• 873.75 sq.m Seed Processing Unit: Located in Ranebennur, Karnataka
  • Modern seed cleaning, grading, treating equipment
  • Packaging and labeling facilities
  • Quality control laboratory
• Warehouse Facility: Integrated with processing unit for inventory storage
  • Climate-controlled storage for seed quality preservation
  • Capacity to handle seasonal inventory build-up

Research & Development:

• 27.25 Acres Leased Farmland: Dedicated R&D farms for breeding programs and trials
• 5 Breeders: Experienced scientists conducting hybrid variety development
• 52 Supporting Employees: Field staff, lab technicians, quality control personnel
• Laboratory Infrastructure: Genetic testing, seed quality analysis facilities
• Focus Areas: High-yielding hybrids, pest/disease resistance, climate adaptation, quality traits

Distribution Network:

• Pan-India reach through multi-tier distribution: Company → Distributors → Dealers → Retailers → Farmers
• Direct farmer engagement programs and field demonstrations
• Sales presence across multiple states covering diverse agro-climatic zones

Supply Chain:

• Raw material sourcing: Breeder seeds (in-house R&D), foundation seeds, parent seeds
• Contract grower network for seed multiplication across geographies
• Quality control at every stage from breeding to final packaging
• Seasonal inventory management (seeds produced during harvest, sold before next sowing season)

Company Strengths

1. Exceptional Profitability Growth – PAT Nearly Doubled (+98% YoY) in FY25:

• Profit After Tax surged from ₹2.15 crore (FY24) to ₹4.27 crore (FY25) – 98% YoY growth (nearly doubled)
• Revenue grew 13% from ₹61.16 cr to ₹69.08 cr, but PAT grew 98% – demonstrating strong operational leverage
• Margin expansion indicates improving product mix (higher-value hybrid varieties), operational efficiency, cost management
• Profitability trajectory validates business model scalability and pricing power in hybrid seed market
• Consistent profitability over FY24-FY25 demonstrates sustainable unit economics vs one-time gains

2. Integrated Seed Value Chain – “Breeder to Farmer” Vertical Integration:

• Complete Control: In-house R&D (breeder seed) → Foundation seed → Contract multiplication → Processing → Distribution
• Quality Assurance: End-to-end quality control from breeding to final packaged seed – ensures genetic purity, germination rates
• Margin Advantage: Vertical integration eliminates middlemen markups; higher gross margins vs pure traders/distributors
• Differentiation: Rare integrated model at SME scale – most small seed companies either focus on R&D or distribution, not both
• Time-to-Market: Direct control over breeding to commercialization – faster launch of new varieties vs licensing external hybrids
• Competitive Moat: Proprietary hybrids developed in-house create product differentiation and customer loyalty

3. Strong R&D Capabilities – 5 Breeders, 27.25 Acres, 20+ Years Expertise:

• Dedicated Research Team: 5 experienced breeders + 52 supporting employees focused on hybrid variety development
• 27.25 Acres R&D Farmland: Leased land for breeding trials, parent line maintenance, field testing across multiple growing seasons
• Laboratory Infrastructure: Genetic evaluation, seed quality testing, trait selection facilities
• 20+ Years Promoter Expertise: Chairman H. N. Devakumar’s two decades of industry experience guides R&D strategy
• Continuous Innovation: Ability to develop new hybrids adapted to evolving farmer needs, pest/disease pressures, climate conditions
• Conventional Breeding Focus: Proven breeding techniques delivering reliable, farmer-accepted varieties (no GMO regulatory hurdles)
• Trait Pipeline: Ongoing research ensures continuous pipeline of new varieties maintaining competitive edge

4. Diversified Product Portfolio – Vegetables, Flowers, Field Crops:

• Multiple Crop Categories: Hybrid seeds for vegetables (tomato, chilli, okra, brinjal, cucurbits), flowers, field crops
• Risk Mitigation: No single crop dependency; pest/disease outbreak in one crop doesn’t devastate entire revenue
• Seasonal Balancing: Different crops have different sowing seasons (Kharif, Rabi) – smoothing seasonal revenue volatility
• Cross-Selling: Single dealer/retailer stocks multiple Unisem seed varieties – increasing wallet share
• Market Expansion: Diverse portfolio enables entry into multiple farmer segments and geographies
• Vegetable Focus: High-value vegetable seeds command premium pricing and margins vs commodity field crops

5. Industry Tailwinds – Hybrid Seed Adoption, Government Support, Food Security Focus:

• Hybrid Seed Market Growth: India’s hybrid seed market growing driven by farmer awareness of higher yields, consistency, pest resistance
• Government Initiatives: National Seed Policy, seed subsidy schemes, seed replacement rate (SRR) improvement programs support hybrid adoption
• Food Security: India’s population growth, urbanization, changing dietary habits driving demand for vegetables, food production intensification
• Import Substitution: Government push for domestic seed production reducing dependence on imports – benefits Indian seed companies
• Technology Adoption: Farmers increasingly investing in quality inputs (seeds, fertilizers, pesticides) for better returns – hybrid seeds core input
• Organized Retail Growth: Modern retail, e-commerce, organized agri-input chains increasing demand for certified, branded seeds vs loose/uncertified seeds

6. 100% Fresh Issue – Strong Promoter Confidence, No Exit Signal:

• No OFS: Entire ₹21.45 crore is fresh capital for company growth (zero promoter/investor exits)
• Promoter Commitment: Chairman H. N. Devakumar not selling any stake – demonstrates belief in future growth potential
• Clean Capital Structure: No investor exits or dilution concerns from OFS
• Productive Allocation: All IPO proceeds benefit company operations (working capital, debt repayment, general corporate) vs going to promoters
• Anchor Confidence: ₹9.36 crore anchor investment validates business model and growth story
• Alignment: Promoter retention ensures interests aligned with minority shareholders for long-term value creation

7. Modern Processing Infrastructure – 873.75 sq.m Facility in Ranebennur:

• Seed Processing Unit: Modern cleaning, grading, treating, packaging equipment ensuring quality standards
• Warehouse: Integrated storage facility for finished seed inventory – climate-controlled preservation
• Quality Control Lab: In-house testing for germination, purity, moisture – ensures product consistency
• Capacity: Infrastructure supports current ₹69 cr revenue with headroom for growth to ₹100-150 cr without major capex
• Location Advantage: Ranebennur, Karnataka proximity to seed production zones, good logistics connectivity
• Scalability: Processing infrastructure allows rapid volume ramp-up as sales grow without bottlenecks

Key Risks & Challenges

1. Intense Competition from Established Giants & Regional Players:

Large Organized Competitors (Listed & Global):

• Kaveri Seed Company Limited: Listed company, ₹655M market cap, ₹143M revenue, 30+ years legacy, 600 acres owned farmland, extensive R&D across maize, cotton, vegetables
• Advanta Seeds (UPL subsidiary): Global reach, extensive R&D, hybrid seed leader across multiple crops
• Bayer CropScience (Bayer AG): Global agri-giant, massive R&D budgets, biotech & hybrid seeds, brand power
• Syngenta Group: Swiss multinational, integrated crop solutions (seeds + agrochemicals), global distribution
• Mahyco (Maharashtra Hybrid Seeds Co.): Pioneer in hybrid seeds in India, strong regional presence, diverse crop portfolio
• Nuziveedu Seeds Limited: Major player in hybrid rice, cotton, maize, vegetables; extensive dealer network
• VNR Seeds, Rasi Seeds, JK Agri Genetics, Rallis India, DuPont Pioneer (Corteva): Established brands with scale

Regional & Local Competitors:

• Hundreds of small-medium seed companies across India serving local markets
• State seed corporations and cooperatives offering subsidized seeds
• Unorganized sector: Farm-saved seeds, uncertified seeds from local traders

Competitive Pressures:

• Unisem’s ₹69 cr revenue vs Kaveri’s ₹143M (~₹1,200+ cr) – 15-20X size gap
• Large players have massive R&D budgets, hundreds of breeders, thousands of acres of R&D farms
• Global brands (Bayer, Syngenta, Corteva) have biotechnology capabilities (Bt, GMO) – regulatory edge
• Extensive dealer networks of established players create distribution barriers for new entrants
• Brand recall: Farmers trust legacy brands; Unisem (8 years) vs Kaveri/Mahyco (30-50 years)
• Pricing competition from unorganized sector and state seed corporations

2. High Working Capital Intensity – Seasonal & Inventory-Heavy Business:

• Seasonal Nature: Seeds produced post-harvest, stored for months, sold before sowing season – long inventory holding periods
• Grower Payments: Contract growers require advance/on-delivery payments for seed multiplication – cash outflow months before sales realization
• Inventory Financing: Finished seed inventory carries working capital for 3-6 months (harvest → processing → storage → distribution → sales)
• Receivables: Dealers/distributors demand 30-90 day credit terms – extended receivables cycles
• Cash Flow Strain: Significant IPO allocation to working capital confirms high cash intensity
• Growth Trap: As revenue scales, working capital requirements grow proportionally – continuous funding needed
• Debt Burden: IPO proceeds for debt repayment indicates existing borrowings for working capital financing

3. Agriculture & Weather Dependency – Crop Failures, Climate Volatility:

• Farmer Income Linkage: Seed demand tied to farmer cash flows, crop profitability, commodity prices
• Monsoon Dependency: Erratic monsoons, droughts, floods impact crop area, farmer sentiment, seed purchases
• Pest/Disease Outbreaks: If major pest attacks specific vegetables (e.g., tomato blight, chilli virus), demand for those seeds collapses
• Climate Change: Unpredictable weather patterns increasing crop risks – farmers may reduce input spending during uncertainty
• Government Policy: MSP (Minimum Support Price) changes, subsidy cuts, export bans impact farmer incomes and seed budgets
• Volatile Demand: Agricultural inputs highly cyclical – boom-bust cycles based on monsoon, commodity prices, policy

4. Quality Control & Seed Performance Risks – Reputation Damage:

• Germination Failures: If seeds fail to germinate or perform below expectations, farmer complaints, brand damage, legal liabilities
• Genetic Purity: Any contamination or off-types (non-hybrid plants) in fields destroys farmer trust
• Contract Grower Quality: Seed multiplication outsourced to contract growers – quality control challenges at scale
• Processing Errors: Seed cleaning, grading, treating mistakes can compromise entire batches
• Storage Issues: Improper warehouse conditions (temperature, humidity) reduce seed viability
• Catastrophic Impact: Single major seed failure incident can destroy brand reputation built over years; farmers switch to competitors

5. Regulatory & Certification Risks – Seed Act Compliance:

• Seed Act Compliance: Seeds must be certified by State Seed Certification Agencies (SSCA) – testing, field inspections, documentation
• Delays: Certification delays can miss planting seasons – entire season’s revenue lost
• Variety Registration: New hybrid varieties require registration with Protection of Plant Varieties & Farmers’ Rights Authority (PPV&FRA) – lengthy process
• Labeling & Packaging: Stringent regulations on seed labeling, germination rates, purity claims – non-compliance penalties
• Inter-State Movement: Seeds moving across states require phytosanitary certificates, compliance with state-specific regulations
• Intellectual Property: Risk of variety piracy; enforcement of plant breeder rights difficult in fragmented market

6. Limited Geographic & Customer Diversification (Likely) – Concentration Risks:

• Regional Concentration: Unisem based in Karnataka; likely majority revenue from Karnataka and neighboring states initially (exact geographic split not disclosed)
• Customer Concentration: Seed distribution often concentrated among few large distributors/dealers – top 10 customers may contribute 40-60% revenue
• Agro-Climatic Limitations: Hybrid varieties developed for specific agro-climatic zones; expanding to new regions requires fresh R&D, field trials
• Single Crop Dominance (Potential): While portfolio diversified, one or two vegetable crops (e.g., tomato, chilli) may dominate revenue – crop-specific risk
• Disclosure Gap: Detailed customer concentration, state-wise revenue split likely in RHP – investors must review before applying

7. SME Listing Challenges – Limited Liquidity, Lower Disclosure Standards:

• BSE SME Platform: Lower trading volumes than mainboard – liquidity constraints, difficulty exiting positions
• Institutional Disinterest: Large mutual funds, FPIs avoid SME stocks due to liquidity and regulatory constraints
• Price Discovery: Low volumes lead to high bid-ask spreads, valuation volatility
• Migration Timeline: Need ₹25 cr paid-up capital and profitability track record for mainboard migration – 3-5 year timeline post-IPO
• Disclosure Standards: SME quarterly reporting less stringent than mainboard – investors have limited visibility into performance
• Market Maker Dependency: Liquidity dependent on market maker activity – if market maker inactive, stock illiquid
• Exit Risk: Challenging to sell holdings during market downturns or company-specific issues
• Valuation Volatility: Thin trading can cause sharp price swings unrelated to fundamentals

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Disclaimer

This information is based on publicly available sources including SEBI DRHP/RHP filings, company disclosures, news reports, and industry research. Investors should conduct their own research and consult with financial advisors before making investment decisions.

Past performance is not indicative of future results. The company reported strong profitability growth (PAT nearly doubled to ₹4.27 crore in FY25), operates an integrated seed value chain with R&D capabilities (5 breeders, 27.25 acres R&D farms), but faces intense competition from established giants (Kaveri Seeds, Bayer, Syngenta, Mahyco, Nuziveedu, Advanta with 15-20X larger scale), high working capital intensity (seasonal & inventory-heavy seed business), agriculture/weather dependency, quality control risks (seed performance critical to reputation), and SME listing liquidity challenges. 100% fresh issue with no OFS indicates promoter confidence, with anchor investment of ₹9.36 crore validating growth story. Investors must review detailed geographic revenue mix, customer concentration, crop-wise revenue split, and working capital cycles in RHP before applying. SME IPO investments carry higher risks including limited liquidity, lower disclosure standards, and price volatility. Grey Market Premium (GMP) not yet active / not reported.