The initial public offering (IPO) of Vibhor Steel Tubes, valued at Rs 72 crore and consisting solely of fresh shares, commenced on February 13. Ahead of the IPO launch, the company secured Rs 22 crore from three anchor investors.
Here are 10 important points to consider before subscribing to the offering:
1) IPO Dates : The IPO is open for subscription from February 13 to February 15.
2) Price Band: The price band for the IPO is set at Rs. 141-151 per share.
3) Offering Details: This IPO exclusively comprises fresh issue of shares. The anchor book, opened on February 12, raised Rs 22 crore from Saint Capital Fund, Chhattisgarh Investments Ltd, and Neomile Growth Fund-Series I.
4) Objectives of the Issue: Proceeds from the IPO will be utilized for funding working capital requirements and general corporate purposes.
5) Lot Size: Investors can bid for a minimum of 99 shares and in multiples of 99 thereafter. Retail investors need to invest a minimum of Rs 13,959 (lot size x lower price band of Rs 141), while the upper bidding amount reaches Rs 14,949.
6) Company Profile : Vibhor Steel Tubes manufactures and exports mild steel/carbon steel ERW black and galvanized pipes, hollow steel pipes, and cold rolled steel strips/coils. The company has a six-year agreement with Jindal Pipes, ensuring a minimum order quantity of 1,00,000 MT per annum.
7) Financials : In FY23, the company’s revenue increased by 36 percent to Rs 1,113.12 crore, with a PAT surge of 86 percent to Rs 21 crore. Financial highlights for the six months ended September 30, 2023, include revenue of Rs 530.51 crore, PAT of Rs 8.52 crore, and EBITDA of Rs 23.69 crore.
8) Issue Managers : Khambatta Securities serves as the lead manager to the IPO, with Kfin Technologies as the registrar. The promoters of the company are Vijay Kaushik, Vibhor Kaushik, Vijay Laxmi Kaushik, and Vijay Kaushik HUF.
9) Risks : Key risks include heavy reliance on Jindal Pipes Limited for revenue, negative cash flows, geographic concentration in Maharashtra and Telangana, and a high debt-to-equity ratio of 1.63 times as of FY23.
10) Listing Date : The basis of allotment will be finalized by February 16, and shares will be credited to successful bidders’ demat accounts by February 19. The anticipated listing date on both NSE and BSE is February 20, as per the red herring prospectus.
