Shyam Metalics and Energy Ltd IPO Information Note

Shyam Metalics IPO

by Nikita Bhoota Last Updated: Jul 04, 2021 - 08:31 am 61.9k Views
Listen icon

This document summarizes a few key points related to the issue and should not be treated as a comprehensive summary. Investors are requested to refer the Red Herring Prospectus for further details regarding the issue, the issuer company and the risk factors before taking any investment decision. Please note that investment in securities is subject to risks including loss of principal amount and past performance is not indicative of future performance. Nothing herein constitutes an offer of securities for sale in any jurisdiction where it is unlawful to do so. This document is not intended to be an advertisement and does not constitute an invitation or form any part of any issue for sale or solicitation of an offer to subscribe for or purchase any securities and neither this document nor anything contained herein shall form the basis for any contract or commitment whatsoever.

Shyam Metalics IPO Details

Issue Opens - June 14, 2021

Issue Closes - June 16, 2021

Price Band - ₹ 303-306#

Face Value - ₹10

#Issue Size - ₹909 cr#

Bid Lot - 45 Equity Shares

Issue Type - 100% Book building

Post money Market cap of 7,805Cr - at upper price band; #at upper price band 

Share Reservation

Net Issue (%)

Promoter and Promoter Group




Source: RHP


Company Background

Shyam Metalics and Energy Limited is a leading integrated metal producing company based in India (Source: CRISIL Report) with a focus on long steel products and ferro alloys. The company is amongst the largest producers of ferro alloys in terms of installed capacity in India, as of February 2021 (Source: CRISIL Report). It has the ability to sell intermediate and final products across the steel value chain. As of March 31, 2020, it is one of the leading players in terms of pellet capacity and the fourth largest player in the sponge iron industry in terms of sponge iron capacity in India (Source: CRISIL Report).


Object of the Offer

The IPO offer comprises a fresh issue and an offer for sale. Out of fresh Issue of ₹657cr, ₹470cr is proposed to be utilized towards repayment/prepayment of certain debt availed by the company and its subsidiaries.



(Cr., unless specified)





Revenue from Operations










EBITDA Margin (%)





Diluted EPS ()





ROE (%)





Gross Debt to Total Equity (x)





Source: RHP, *not annualized 

For additional information and risk factors please refer to the Red Herring Prospectus. Please note that this document is for information purpose only

Also Read: Upcoming IPOs in 2021

Key Points

Diversified product mix with strong focus on value added products

The company products primarily comprise of (i) long steel products, which range from intermediate products, such as, iron pellets, sponge iron and billets and final products, such as, TMT, customized billets, structural products and wire rods; and (ii) ferro alloys with a specific focus on high margin products, such as, specialized ferro alloys for special steel applications. The company also undertakes conversion of hot rolled coils to pipes, chrome ore to ferro chrome and manganese ore to silico manganese for an Indian steel conglomerate. The forward and backward integration of manufacturing plants has resulted in multiple points of sale across the steel value chain and provided with flexibility to sell intermediate products as well as use them for captive consumption, depending on the demand. This has resulted in a diversified product mix, which has reduced dependency on a particular product and de-risked revenue streams.

Strong financial performance and credit ratings

The company focuses on continuous efficiency improvements, improved productivity and cost rationalization has enabled it to deliver consistent and strong financial and operational performance. The company has a relatively better financial strength as compared to other companies operating in the long and intermediary steel sector. Revenue from operations increased at a CAGR of 6.56% from ₹3,843 cr in FY2018 to ₹4,363 cr in FY2020. Further, since the commencement of operations in FY 2005, the company has delivered a positive EBITDA in each of the Fiscals. As of March 31, 2020, the gearing ratio was one of the lowest amongst the competitors. In FY 2020, the interest coverage ratio was one of the highest amongst competitors (Source: CRISIL Report). The company has also obtained strong credit ratings. In particular, the company and its subsidiary, Shyam SEL and Power Limited, has received CRISIL A1+, CRISIL AA-/ Stable, and CRISIL A1+ rating from CRISIL for their short-term (bank facilities) rating, long-term (bank facilities) rating and commercial paper, respectively. In addition, the company and its subsidiary, Shyam SEL and Power Limited, has received CARE A1+, CARE AA-/ Stable, and CARE A1+ rating from CARE for their short term (bank facilities) rating, long-term (bank facilities) rating and commercial paper, respectively.

Experienced Promoters, Board and senior management team

The company is led by individual Promoters, Mahabir Prasad Agarwal, Brij Bhushan Agarwal and Sanjay Kumar Agarwal, who have several decades of experience in the steel and ferro alloys industry, and have been instrumental in the growth of the company. The company also has an experienced Board of Directors who has extensive knowledge and understanding of the metal industry and has the expertise and vision to scale up business. The chairman, Mahabir Prasad Agarwal, is responsible for strategic planning and overall administration of the company. The vice chairman and managing director, Brij Bhushan Agarwal, is responsible for implementing future growth strategies. The joint managing director, Sanjay Kumar Agarwal, is responsible for the entire production process at the manufacturing plants. The whole-time director Deepak Kumar Agarwal is responsible for the finance functions.

Key Risk

  • Loss of any of suppliers or a failure by suppliers to deliver some of primary raw materials such as iron ore, iron ore fines, coal, chrome ore and manganese ore may have an adverse impact on the company’s ability to continue its manufacturing process without interruption and its ability to manufacture and deliver the products to the customers without any delay.
  • The success of the company depends on stable and reliable logistics and transportation infrastructure. Disruption of logistics and transportation services could impair the ability of suppliers to deliver raw materials or the company’s ability to deliver products to its customers which may adversely affect operations.
  • The demand and pricing in the steel industry is volatile and are sensitive to the cyclical nature of the industries it serves. A decrease in steel prices may have a material adverse effect on the business, results of operations, prospects and financial condition.

* For complete list of risk factors kindly refer to the Shyam Metalics Red Herring Prospectus.

About 5paisa:- 5paisa is an online discount stock broker that is a member of NSE, BSE, MCX and MCX-SX. Since its inception in 2016, 5paisa has always promoted the idea of self-investment and has ensured that 100% operations are executed digitally with minimal to no human interventions. 

Our all-in-one Demat account makes investment hassle free for everyone, be it an individual newly venturing into the investment market or a pro investor. Headquartered in Mumbai, - a subsidiary of IIFL Holdings Ltd (formerly India Infoline Limited), is the first Indian public listed fintech company.

How do you rate this blog?


Start Investing in 5 mins*

Rs. 20 Flat Per Order | 0% Brokerage


About the Author

Open Free Demat Account
Resend OTP
Please Enter OTP
Mobile No. belongs to

By proceeding, you agree to the T&C.

Latest Blogs
Weekly Wrap-up: Tata Tech's Dazzling IPO Debut & the Tax Tale

In the heart of the bustling Indian stock market, a tale of triumph unfolded on November 30th, as Tata Technologies made an awe-inspiring debut. The curtains lifted at ₹1,200 apiece on the National Stock Exchange (NSE), casting a premium spell of 140% over the issue price of ₹500 per share. This stellar entry marked the grandest listing since November 2021, echoing through the financial corridors with waves of excitement.

Stock In Action: JSW Steel

Movement of the Day Analysis 1.    Strengths: Strong Momentum: Price above short, medium and long term from 5 days to 200 days respectively. 2.    Positive break-out. 

Swing Trading Stocks: Week of 11 December 2023

Swing Trading Stocks for the Week