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Vraj Iron and Steel IPO is a book-built issue of Rs 171.00 crores. The issue is entirely a fresh issue of 0.83 crore shares. The IPO opens for subscription on June 26, 2024, and closes on June 28, 2024.
Further, the IPO price band is set at ₹195 to ₹207 per share, and the minimum lot size for an application is 72 Shares.
Company Summary
This Company is engaged in manufacturing Sponge Iron, M.S. Billets, and TMT bars under the brand Vraj. The company runs two manufacturing plants in Raipur and Bilaspur, Chhattisgarh, covering 52.93 acres.
The company’s product portfolio comprises offerings such as Sponge Irons, TMT Bars, MS Billets, and by-products Dolochar, Pellets, and Pig Iron, which cater to a mix of industrial customers and end-users.
As of December 31, 2023, the total installed capacity of the manufacturing plants was 231,600 tons per year, including intermediate and final products.
The company currently has a production capacity of 57,600 TPA of MS Billets, which its rolling mills can use to manufacture TMT Bars with a production capacity of 54,000 TPA.
As of December 31, 2023, they had a workforce of 531 employees & workers, comprising 296 permanent employees including 3 Directors, 9 employees at the Registered Office, 193 employees at the Raipur Plant and 91 employees at the Bilaspur Plant, and 235 contract workers.
Company Strengths
They have been able to grow the quantity sold, between Fiscal 2021 and Fiscal 2023, of TMT Bars at a CAGR of 78% and Sponge Iron at a CAGR of 8%.
The Company has a captive power plant with an installed capacity of 5MW which helps them to reduce energy costs. Additionally operating a captive power plant will decrease their exposure to disruptions to the electricity grid in times of power outages that can otherwise lead to costly production disruptions.
Their focus on operational and functional excellence has contributed to their track record of healthy financial performance with total Income having grown at a CAGR of 33.4% between Fiscal 2021 and Fiscal 2023.
EBITDA has grown at a CAGR of 67.2% between Fiscal 2021 to Fiscal 2023 and Profit After Tax at a CAGR of 121.7% between Fiscal 2021 and Fiscal 2023.
For the nine months ended December 2023 and Fiscals 2023, 2022, and 2021, they have achieved a profit margin of 14.79%, 10.47%, 6.93%, and 3.78%, respectively, as per their Restated Consolidated Financial Statements.
Company Financials
| Period Ended | 31 Dec 2023 | 31 Mar 2023 | 31 Mar 2022 | 31 Mar 2021 |
| Assets | 253.05 | 191.54 | 150.77 | 126.33 |
| Revenue | 304.81 | 517.42 | 414.38 | 290.93 |
| Profit After Tax | 44.58 | 54.00 | 28.70 | 10.99 |
| Net Worth | 187.50 | 140.92 | 87.14 | 57.79 |
| Reserves and Surplus | 162.78 | 135.97 | 82.19 | 52.85 |
| Total Borrowing | 49.30 | 22.98 | 42.51 | 45.78 |
Amount in ₹ Crore | ||||
Objectives of the IPO
The Company proposes to utilize the Net Proceeds in the following manner
- Repayment or prepayment of borrowings from HDFC Bank obtained by our Company for the capital expenditure towards the “Expansion Project” at Bilaspur Plant.
- Capital expenditure towards the “Expansion Project” at Bilaspur Plant.
Promoters of the company
Vijay Anand Jhanwar, Kusum Lata Maheshwari, Gopal Sponge, and Power Private Limited, V.A. Transport Private Limited, Kirti Ispat Private Limited, Bhinaswar Commercial Private Limited, and Utkal Ispat Private Limited are the Promoters of our Company.
The Promoters in aggregate, hold 24,721,720 Equity Shares in our Company, representing 99.99% of the issued, subscribed, and paid-up Equity Share capital of our Company.
IPO details
| IPO Date | June 26, 2024 to June 28, 2024 |
| Listing Date | Wednesday, July 3, 2024 |
| Face Value | ₹10 per share |
| Price Band | ₹195 to ₹207 per share |
| Lot Size | 72 Shares |
| Total Issue Size | 8,260,870 shares (aggregating up to ₹171.00 Cr) |
| Fresh Issue | 8,260,870 shares (aggregating up to ₹171.00 Cr) |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE, NSE |
Lot Allocation details
| Application | Lots | Shares | Amount |
| Retail (Min) | 1 | 72 | ₹14,904 |
| Retail (Max) | 13 | 936 | ₹193,752 |
| S-HNI (Min) | 14 | 1,008 | ₹208,656 |
| S-HNI (Max) | 67 | 4,824 | ₹998,568 |
| B-HNI (Min) | 68 | 4,896 | ₹1,013,472 |
Allotment Schedule
| Basis of Allotment | Monday, July 1, 2024 |
| Initiation of Refunds | Tuesday, July 2, 2024 |
| The credit of Shares to Demat | Tuesday, July 2, 2024 |
| Listing Date | Wednesday, July 3, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on June 28, 2024 |
IPO Reservation
| Investor Category | Shares Offered |
| QIB Shares Offered | Not more than 50% of the Net Issue |
| Retail Shares Offered | Not less than 35% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
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