BUSINESS OVERVIEW

Company Profile

 We are in the business of manufacturing, marketing and selling of modern building

materials and construction chemicals with a suite of more than 80 products which
includes a range of construction materials and construction chemicals in both powder
and liquid forms. Our products are marketed and sold under the “MCON” brand.

 We have strong presence over three states, majorly in Maharashtra, Gujarat and
Rajasthan with 100 distributors and 1300 retailers.

 We enjoy brand stickiness among contractors, real estate developers and institutions
because of our product innovation and customization which is very rare in this industry
and also among retailers through our brand logo “MCON”.

 Our company currently have 2 manufacturing plants one each in Valsad and Navsari,
Gujarat and sensing a huge opportunity in this sector, we did a capex in a Greenfield
project in Ambethi, Valsad which will be operational by FY 2023.

 Our range of products are very specialized and needs years of experience and research
and more important understanding the client requirement and years of relationship
which have enabled us to expand to more markets.

 Our diversified product range ensures that we can cater to the growing housing sector as
well as the currently most invested sector by the Government – the infrastructure
segment.
The financial performance of our company for the period September 30 th, 2022, and Fiscals
2022, 2021, and 2020 are as follows:-

(Rs. In lakhs, except for the percentage)

Particulars For the period Fiscal 2022 Fiscal 2021 Fiscal 2020
ended
September 30th,
2022

Revenue from 1,304.39 1,921.65 897.77 896.62

operations

EBITDA 157.60 128.04 91.38 65.41

EBITDA margin 12.80% 6.66% 10.18% 7.30%

(%)

PAT 85.64 44.40 18.68 3.61

PAT Margin (%) 6.57% 2.31% 2.08% 0.40%

Net Debt 642.63 740.85 346.58 321.61

Total Equity 456.93 221.29 178.40 110.72

RoE (%) 18.74% 20.06% 10.47% 3.26%

RoCE (%) 12.91% 9.93% 12.12% 7.90%

EPS (Basic & 5.48 2.96 1.84 0.64
Diluted)
Issue Proceeds & Net Proceeds from IPO

The details of the proceeds of the Issue are set out in the following table:
(Rs. in lakhs)

Particulars Amount

Gross Proceeds of the Issue 684.00

Less: Issue-related expenses 70.00

Net Proceeds of the Issue 614.00

Utilization of Net Proceeds

The proposed utilization of Net Proceeds is set forth as stated below:
(Rs. in lakhs)
Sr. Particulars Amount % of Net
No. Proceeds

1. Funding the working capital requirements of the company 450.00 73.29

2. General Corporate Purposes 164.00 26.71

Total 614.00 100.00

Profile of Directors

Mahesh Ravji Bhanushali is the Promoter of our Chetan Ravji Bhanushali is the Whole-time
Company and the Chairman & MD of the company. Director of our Company. He was appointed to the
He has been the main guiding force behind the Board with effect from 30th September 2021. He has
growth and business strategy of our company. He has an experience of 11 years in the construction &
more than 14 years of experience in dealing in the chemical industry. He looks after the sales and
business of construction chemicals. He has completed receivables of the company. He has completed his
his higher secondary education from Maharashtra higher secondary education from the Maharashtra
State Board of Secondary and Higher Secondary State Board of Secondary and Higher Secondary
Education, Pune, Maharashtra. Education, Pune, Maharashtra.

Puja Mahesh Bhanushali is a Non-Executive Nandan Dilip Pradhan is the Whole Time Director
Director in our Company. She holds a master’s of the Company. He holds a master’s degree in
degree in Commerce from the University of Mumbai. Business Administration from North Maharashtra
She has been associated with our company since University and a Bachelor’s degree in Science from
incorporation. She looks after human resource related the Maharaja Sayajirao University of Baroda. He was
activity in our Company. appointed to the board with effect from 19th
December 2022. He has an experience of more than 2
decades.
Tapas Bimal Majumdar is an Independent Dilip Mangilal Jain is an independent Director of
Director of our Company. He holds a master’s our Company. He holds a bachelor’s degree in
degree in Human Resources Development and Science. He is also a member of The Institute of
Management from the Narsee Monjee Institute of Cost and Works Accountants of India. He has an
Management Studies. He is the founder of experience of more than three decades. He has
SustainabilityPractioners, an enterprising start-up worked with banks and financial institutions. He is
that is engaged in sustainability practice and also the founder director of Hyphen Training and
reporting-related activities. Consulting Private Limited. He was appointed to the
Board with effect from December 19, 2022.

Dhara Haresh Thakkar is an Independent Director Sonal Alok Doshi is an Independent Director of our
of our Company. She was appointed to the Board Company. She was appointed to the Board with
with effect from December 19, 2022. She is a effect from December 19, 2022. She holds a
qualified CA. She has an experience of more than master’s degree in business administration from The
10 years in the field of auditing, accounts, and Institute of Chartered Financial Analysts of India
taxation. She is currently associated as a Senior University, Tripura.
Manager at Drip Capital Inc.
Comparison of Domestic Peers in the Industry

Company CMP EPS (in RoNW Revenue PAT PE ratio NAV per
(In Rs.) Rs.) (in %) (Rs. In (Rs. In share
Crores) Crores)

Pidilite 2,275.7/- 24.48 10.43% 11,617 1,257 92.96 128.12

Industries Ltd.

Asian Paints 2,738/- 38.81 13.19% 33,594 3,811 70.54 142.37

Ltd.

Kansai Nerolac 419 7.51 6.54% 7,346 391 55.79 81.61

Paints Limited

Mcon Rasayan 40/- 5.48 18.74% 13.04 0.856 7.29* 24.37

Ltd

*PE calculation is based on pre-money valuation.

 In the construction chemical market industry, some major key players are Asian Paints,
Astral Adhesives, Ultratech Cement Ltd. (Building Material Division), and Pidilite
Industries Ltd.

 These players have established themselves through strong branding, marketing, and
distribution for more than 2 decades.

 These players have a portfolio of niche products that are used in the application for
different construction phases.

 Therefore our product portfolio has less competition compared to other major players’
product portfolios like Pidilite, Astral, etc.

 These major players enter the product segment which is already explored, but not in our
case, we are in the untapped product segment which is driven by exponential growth.
Competitive Strength
Comprehensive Product Portfolio
Our suite of products includes a range of construction materials and chemicals such as concrete
admixtures, tile adhesives & grout, waterproofing systems/products, concrete repairs, ready mix
mortar, wall finishes and paints, anti-corrosive system/products, engineering grouts & industrial
floors and concrete essentials. Our products are marketed and sold under the “MCON” brand.

Experienced Promoter and Senior Management Team

Our Promoter, Mahesh Bhanushali has vast knowledge and experience of more than 14 years in
modern building materials and construction chemicals manufacturing and sales. He has been the
driving force in developing and growing our business. His understanding of the industry
requirements, intuitive entrepreneurship, and involvement in key aspects of our business have
helped accelerate and drive our profitable growth.
Our Executive Director Mr. Nandan Pradhan has a professional experience of more than 25
years and majority has been spent with Construction chemicals manufacturers. He has headed
large organisations and driven them to Organic growth. His strong network in the Construction
Industry and a diverse business experience adding on the knowledge of all modern
technologies, software and latest global products gives Mcon Rasayan the edge in this
competitive industry.
Strategic location of manufacturing units
We have two manufacturing units out of which one is situated at GIDC Sarigam, Valsad,
Gujarat which are industrial belts which is a manufacturing hubs for various industries like
chemicals, agrochemicals, pharmaceuticals, lubricants, food, edible oil, etc. Our other plant is
situated at Chikli, Navsari, Gujarat. Our third plant is a Greenfield project under construction at
Ambethi, Valsad, Gujarat, and will be operational by the end of FY 2023. These manufacturing
plants are located near the river sand reserves to ensure cost effective production of the powder
products and also located near the Financial Capital of India – Mumbai to give us access to the
biggest market of this product.

Diverse Customer Base

We cater to the modern building and development requirements of our clients like developers,
civil contractors, and architects. We have over the years established relationships with various
clients and continue to serve them with our product offerings. We supply our products through
market intermediaries like dealers and distributors to institutional customers like builders &
developers and large civil & engineering contractors involved in the construction of civil,
commercial, and infrastructure projects.
In-house research and development of products
We undertake in-house research and development for innovative products which help our
clients in solving issues faced by them. We have created eight (8) innovative products in the
past three (3) years either independently or in consultation with our clients.
In the current financial year, we have launched the following new products to our existing line
of products:
➢ MCON CI 300: Corrosion Inhibiting Concrete Admixture - Bipolar corrosion inhibiting
admixture in liquid form for reinforced concrete and mortar.
➢ MCON EPOXY SBA: Epoxy Adhesive for Segmental Bridge – This is a solvent-free
thixotropic two-part epoxy adhesive for bonding prefabricated concrete bridge segments.
➢ MCON 2K EPOXY FG Paint - This is a two-component, epoxy-based food grade paint that
is suitable for painting concrete/metal surfaces, including walls, which is safe to be used for
containers which are used to store drinking water and other important ingredients.
Quality Standard Certification & Quality Tests
We have obtained ISO 9001, ISO 14001, and ISO 45001 for the management systems at our
manufacturing facility at GIDC Sarigam, Valsad, Gujarat. Our products undergo stringent
quality tests to meet industry standards before they are delivered to our clients. Wherever
required by our clients, we obtain industry-standard test certificates from our suppliers for the
raw materials used by us for specific products.

Our Business Strategies

a) Greenfield project for increasing our manufacturing capacity near Ambethi, Valsad,
Gujarat.
 Increase our market share and strengthen our position in the industry by setting up
a Greenfield manufacturing plant at Ambethi, Valsad, Gujarat with a fresh capacity
of 18,000 MTPA.
 The funding requirement for civil construction, purchase of plant and machinery,
and other equipment for this expansion is Rs.8 crores and will be financed through
internal accruals and borrowings from banks.

b) Further developing our institutional sales business

 Intend to further expand our institutional sales business by developing relationships
with large real estate developers, civil and infrastructure contractors, and government
bodies such as MHADA and CIDCO.
 Expand our project dealer network by developing relationships with project dealers,
and civil construction contractors who have specific requirements for each stage of
development.

c) Geographical expansion of our distribution network

 Already we have a presence in Maharashtra, Gujarat, and Rajasthan through 100
distributors and 1300 retailers indirectly.
 Intend to expand our product offerings across the country and overseas markets like
Bangladesh where economic development is happening at a fast pace.
d) Enhancing the visibility and reach of our brand “MCon”.
 Having a multi-pronged branding, as well as marketing strategy, covering both retail
and institutional markets.
 For better brand recall, we have created our brand mascot “Mr.M” and we market him
as a solution provider to the Construction Industry.

e) Expanding our sales and distribution network

 Already have a presence in the western zone with presence in states like Gujarat,
Maharashtra, and Rajasthan.
 Planning to enter states like Madhya Pradesh, Uttar Pradesh, Goa, and Karnataka.
 Proposed to expand our sales and distribution network after completion of a proposed
manufacturing plant at Ambethi, Valsad, Gujarat.
Product Portfolio
Liquid Products
Powder Products
Manufacturing Process- Liquid Products
Manufacturing Process- Powder product
Indian Construction Chemical Industry-Proxy to India’s Infrastructure & Real
Estate Sector

Length and Rate of Highway Construction in India

NHAI- Projects awarded and completed (in Kms)

Source: - MoRTH submissions and CareEdge Research

 Indian construction chemical industry is directly linked to two major industries, i.e.
infrastructure and real estate industry, therefore their growth is directly linked
 Since India is a developing country, therefore there is huge headroom for these industries
to grow very well.
 In short, we can say Construction Chemical Industry is a Proxy for Infrastructure and
Real Estate sectors.

Key Developments in Indian Infrastructure Space

 In Union Budget 2021, to support initiatives such as ‘Housing for All’ and ‘Smart Cities
Mission’, the government allocated Rs. 13,750 crores (US$ 1.89 billion) to AMRUT and
Smart Cities Mission.
 In March 2021, the Parliament passed a bill to set up the National Bank for Financing
Infrastructure and Development (NaBFID) to fund infrastructure projects in India.
 The Infrastructure sector has become the biggest focus area for the Indian Government.
India plans to spend US$1.4 trillion on infrastructure during 2019-23 to have sustainable
development of the country.
 India being a developing nation is set to take full advantage of the opportunity for the
expansion of the infrastructure sector, and it is reasonable to conclude that India’s
Infrastructure has a bright future ahead of it.
 Key allocation by Ministry of Housing and Affairs for FY2023

Key Developments in Real Estate Sector

 FDI in the sector (including construction development & activities) stood at US$55.18
billion from April 2000- September 2022.
 Between January-July 2022, private equity investment inflows into the real estate sector
in India stood at US$ 3.27 Billion.
 Home sales volume across seven major cities in India surged 113% YoY to reach 62,800
units in the third quarter of 2021, from 29,250 units in the same period last year,
signifying a healthy recovery post the strict lockdown imposed in the second quarter due
to the spread of COVID-19 in the country.
 The current shortage of housing in urban areas is estimated to be 10 million units. An
additional 25 million units of affordable housing are required by 2030 to meet the growth
in the country’s urban population.
Financials

Revenue (in Lakhs)

2000
1800
1600
1400
1200
1000 1922.36
800 1304.67
600 896.62 899.78
400
200
0
F.Y.2020 F.Y.2021 F.Y.2022 F.Y. 30th
September, 2022

Revenue (in Lakhs)

EBITDA (in Lakhs)

180
160
140
120
100
80
160.31
136.59
60
92.97
40 67.69
20
0
F.Y.2020 F.Y.2021 F.Y.2022 F.Y. 30th
September,2022

EBITDA (in Lakhs)

 Net Profit (in Lakhs)

90
80
70
60
50
85.64
40
30
44.4
20
18.68
10
3.61
0
F.Y.2020 F.Y.2021 F.Y.2022 F.Y.30th
September,2022

Net Profit (in Lakhs)

Return on Equity (in %)

25%

20%

15%
25%
22%
10%
13%
5%
4%
0%
F.Y.2020 F.Y.2021 F.Y.2022 F.Y.30th September,
2022

Return on Equity (in %)

 Net Profit Margin (in %)

7%

6%

5%

4% 7%
3%

2%
2% 2%
1%
1%
0%
F.Y.2020 F.Y.2021 F.Y.2022 F.Y.30th
September,2022

Net Profit Margin

Debt to Equity Ratio

3.5

2.5

2
3.35
1.5
2.9

1.94
1
1.41
0.5

0
F.Y.2020 F.Y.2021 F.Y.2022 F.Y.30th
September,2022

Debt to Equity Ratio

Restated Financial Statements
Balance Sheet
Statement of Profit & Loss
Cash-Flow Statement
Disclaimer

This Release / Communication, except for the historical information, may contain statements,
including words or phrases such as expects, anticipates, intends, will, would, undertakes, aims,
estimates, contemplates, seeks to, objective, goal, projects, should’ and similar expressions or
variations of these expressions or negatives of these terms indicating future performance or
results, financial or otherwise, which are forward-looking statements. These forward-looking
statements are based on certain expectations, assumptions, anticipated developments, and other
factors which are not limited to risk and uncertainties regarding fluctuations in earnings, market
growth, intense competition and the pricing environment in the market, consumption level,
ability to maintain and manage key customer relationship and supply chain sources and those
factors which may affect our ability to implement business strategies successfully, namely
change in regulatory environments, political instability, change in international oil prices and
input costs and new or changed priorities of the trade.

The Company, therefore, cannot guarantee that the forward-looking statements made herein
shall be realized. The Company, based on changes stated above, may alter, amend, modify, or
make necessary corrective changes in any manner to any such forward-looking statement
contained herein or make written or oral forward-looking statements as may be required from
time to time based on subsequent developments and events. The Company does not undertake
any obligation to update forward-looking statements that may be made from time to time by or
on behalf of the Company to reflect the events or circumstances after the date hereof.