Vibhor Steel Tubes IPO Details
- Issue Size: Up to 72.17 Cr.
- Price Band: ₹141 – ₹151 per share
- Minimum Lot Size: 99 Shares
- Minimum Investment Amount: ₹14,949
- Close Date: February 15, 2024
- Open Date: February 13, 2024
- Allotment Date: February 16, 2024
- Listing Date: February 20, 2024
- Book Running Lead Managers: Khambatta Securities Limited
- Registrar: Kfin Technologies Limited
- Fresh Issue: 72.17 Cr
- Offer for Sale: ₹[.]Crore
Vibhor Steel Tubes IPO Timeline
| IPO Open Date: | February 13, 2024 |
| IPO Close Date: | February 15, 2024 |
| Basis of Allotment: | February 16, 2024 |
| Refunds: | February 19, 2024 |
| Credit to Demat Account: | February 19, 2024 |
| IPO Listing Date: | February 20, 2024 |
About
Vibhor Steel Tubes Limited is a leading manufacturer of Hollow Sections (Pipes and Tubes) in India. The Company was incorporated in 1996 and is headquartered in Delhi. The Company has a manufacturing facility in Mandi Gobindgarh, Punjab.
The Company’s products are used in a variety of industries, including construction, automotive, engineering, and agriculture. The Company’s customers include leading companies such as Larsen & Toubro, Tata Projects, and Jindal Steel & Power.
OBJECTIVE
- To meet the working capital requirements of the Company.
- For general corporate purposes.
POSITIVE
- Strong financial performance: The company has shown good revenue and profit growth in recent years.
- Leading position in a growing market: Vibhor Steel Tubes is a leader in the Hollow Sections market in India, which is expected to grow due to increasing demand in construction, automotive, and other industries.
- Experienced management team: The company has a team with experience in the steel industry.
- Reasonable valuation: The IPO price appears to be in line with valuations of other steel companies in India.
NEGATIVE
- Cyclical industry: The steel industry is cyclical and subject to fluctuations in demand and prices, which could impact the company’s performance.
- Competition: The company faces competition from other steel companies in India, which could put pressure on margins.
- Raw material dependence: The company’s operations are dependent on the availability and price of steel billets, which could be volatile.
- Limited track record: The company has been profitable in recent years, but it has a limited track record compared to some other listed steel companies.
So, how does Vibhor Steel Tubes IPO Fare in Terms of Financials?
Financial Details
| Period Ended | 30 Sep 2023 | 31 Mar 2023 | 31 Mar 2022 | 31 Mar 2021 |
| Assets | 376.48 | 293.63 | 248.54 | 172.93 |
| Revenue | 531.24 | 1,114.38 | 818.48 | 511.51 |
| Profit After Tax | 8.52 | 21.07 | 11.33 | 0.69 |
| Net Worth | 101.76 | 93.20 | 71.97 | 60.49 |
| Total Borrowing | 160.27 | 126.83 | 106.07 | 58.74 |
| Amount in ₹ Crore | ||||
FINANCIAL REVIEW
Positives:
- Strong Revenue Growth: Revenue has doubled in the last year and grown by over 100% in the past two years, indicating strong demand for their products.
- Profitability: They’ve become profitable in the last two years, with profit after tax increasing significantly.
- Improving Net Worth: While slower than revenue growth, net worth has also increased, indicating financial stability.
- Moderate Debt Growth: Though debt has increased, it’s at a slower pace than assets, showing controlled borrowing.
Negatives:
- Limited Track Record: Only two years of profitability offer a limited view of financial health and sustainability.
- High Debt: Although growing slower than assets, the debt level is still relatively high compared to net worth.
- Dependence on Industry: Steel industry cyclicality could impact future performance.
Vibhor Steel Tubes IPO Valuation
| KPI | Values |
|---|---|
| ROE | 25.51% |
| ROCE | 16.48% |
| Debt/Equity | 1.63 |
| RoNW | 22.60% |
| P/BV | 2.3 |
Vibhor Steel Tubes IPO – SWOT Analysis
Strengths
- Strong financial performance: Consistent revenue and profit growth in recent years.
- Market leader: Leading player in the Indian Hollow Sections market with good brand recognition.
- Experienced management: Team with proven experience in the steel industry.
- Reasonable valuation: IPO price seems competitive compared to peers.
- Growing market: Indian steel industry projected to expand, with increasing demand in construction, automotive, and other sectors.
Weaknesses
- Limited track record: Relatively young company compared to some listed competitors.
- Dependence on raw materials: Fluctuations in steel billet prices and availability can impact profitability.
- Competition: Faces competition from established players, both domestic and international.
- Limited product portfolio: Primarily focused on Hollow Sections, susceptible to market changes in that segment.
- High debt levels: Relatively high debt-to-equity ratio compared to some peers.
Opportunities
- Expansion into new segments: Possibility to diversify product portfolio to reduce dependence on specific markets.
- Export potential: Growing global demand for steel products could open up export opportunities.
- Technological advancements: Adoption of new technologies could improve efficiency and reduce costs.
- Government initiatives: Supportive government policies in the steel sector could benefit the company.
- Strategic partnerships: Collaborations with other companies could expand reach and market share.
Threats
- Economic slowdown: Potential economic slowdown could dampen demand for steel products.
- Trade wars: Trade conflicts or protectionist policies could impact exports and raw material prices.
- Environmental regulations: Increasing environmental regulations could raise compliance costs.
- Fluctuations in currency exchange rates: Can impact import costs and export competitiveness.
- Industry consolidation: Potential consolidation in the steel industry could increase competition.
COMPETITIVE ANALYSIS: MARKET PEERS
Here are some of the key market peers of Vibhor Steel Tubes IPO:
Peers:
- APL Apollo Tubes Ltd.
- Hi-Tech Pipes Ltd.
- Goodluck India Ltd.
- Rama Steel Tubes Ltd.
Vibhor Steel Tubes IPO GMP
- Grey market premium as on 12-02-2024= Rs – 120/ Share
Disclaimer:
- IPO Grey Market Premium (Vibhor Steel Tubes IPO GMP) mention is valid for the specific date as mentioned in the header.
- We are not buying and selling IPO forms on IPO Grey Market.
- Do not subscribe for IPO by just seeing premium Price as it may change anytime before listing. Subscribe only considering Fundamentals of the companies.
Vibhor Steel Tubes IPO
🔴 Live Subscription Status 🔴
15/02/2024 5:00 PM
| | NO OF SHARES OFFERED | Day 1 | Day 2 | Day 3 |
| Qualified Institutional Buyers(QIBs) | 10,17,441 | 3.56 | 8.52 | 178.73 |
| Non Institutional Investors(NIIs) | 7,63,023 | 48.28 | 252.07 | 721.33 |
| Retail Individual Investors(RIIs) | 17,80,386 | 32.39 | 90.11 | 188.17 |
| Employees | 31,595 | 27.38 | 78.74 | 201.48 |
| Total | 35,92,445 | 27.56 | 101.30 | 298.86 |
FINAL TAKEAWAY
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