IPO Synopsis
Shri Bajrang Power and Ispat Ltd has received capital markets regulator Sebi's go-ahead to raise Rs 700 crore through an initial share sale. For FY21, Bajrang Power reported a revenue of Rs. 3,031.21 crore vs Rs. 2,663.71 crore a year ago. Net profit for the period stood at Rs. 298.93 crore against Rs. 141.05 crore last year. Its total sanctioned limit of working capital facilities of Rs. 555 crore, including fund-based and non-fund-based limits and the aggregate amounts sanctioned under the fund based and non-fund based working capital facilities are Rs. 325 crore and Rs. 230 crores, respectively. Equirus Capital Pvt Ltd and SBI Capital Markets Ltd are the lead managers to the issue.
Objective of the Issue
The company proposes to utilise net proceeds of the issue for:
Prepaying existing debt of Rs. 400 crore and become debt-free on a standalone basis
Use Rs. 120 crores for funding working capital requirements
About Shri Bajrang Power & Ispat Ltd
Shri Bajrang Power and Ispat is one of the leading integrated steel companies based in central India with 11 distributors with a network of 514 dealers and is one of the top 10 players in India in terms of capacity for iron ore pellets, iron ore beneficiation and sponge iron. The firm utilizes its captive iron mine with an approval to mine 1.2 MTPA and manganese ore mines to manufacture intermediate and long steel products, such as, TMT bars, ERW pipes manufactured through tubular section mill, wire rods, HB wires including binding wires, ferro alloys, steel billets, iron pellets and sponge iron.
The firm operates three manufacturing units in Raipur, Chhattisgarh which has abundant reserves of iron ore, iron ore fines and coal mines, its primary raw material sources. The firm has exclusive mining rights for an open-cast manganese ore mine located at Vizianagaram, Andhra Pradesh wherein it is permitted to mine 13,114 metric tonne per annum (“TPA”). For coal, it has secured coal linkages with South Eastern Coalfields Limited, a subsidiary of Coal India Limited, for annual supply of 6.03 MTPA. In May 2021, the installed capacity of iron-ore beneficiation and pelletisation units was 2.0 MTPA and 1.4 MTPA, respectively.
The firm is also in the process of expanding its capacity for sponge iron, steel melting, rolling mill, ferro alloys, captive power and setting up a galvanising plant, which is expected to be completed within FY22. Further, it intends to set up a 50MW solar power plant at Raipur It has a consistent track record of delivering operating profitability, and since fiscal 2005, has remained profitable in each of the financial years.
Shri Bajrang Power & Ispat Ltd Financial Status
|
Particulars (in Rs. Crores) |
FY21 |
FY20 |
FY19 |
|
Revenue |
3,031.21 |
2,663.71 |
2,685.23 |
|
EBITDA |
629.07 |
396.55 |
532.22 |
|
PAT |
298.63 |
141.13 |
237.47 |
|
EPS (basic in Rs.) |
57.3 |
26.87 |
45.39 |
|
ROE |
26.14% |
16.97% |
34.64% |
|
Particulars (in Rs. Crores) |
FY21 |
FY20 |
FY19 |
|
Total Assets |
2,839.13 |
2,501.37 |
2,275.99 |
|
Share Capital |
52.29 |
52.29 |
52.29 |
|
Total Borrowings |
1,268.23 |
1,234.60 |
1,183.56 |
|
Particulars (in Rs. Crores) |
FY21 |
FY20 |
FY19 |
|
Net cash generated from / (used in) operating activities |
249.99 |
262.23 |
221.62 |
|
Net cash from / (used in) investing activities |
-112.35 |
-190.08 |
-94.03 |
|
Net cash flow from / (used in) financing activities |
-124.52 |
-71.71 |
-127.43 |
|
Net increase (decrease) in cash and cash equivalents |
13.12 |
0.44 |
0.16 |
Peer Comparison -
|
Name of the company |
Total Revenue (in Rs. crores) |
Basic EPS |
NAV Rs. per share |
PE |
RoNW % |
|
Shri Bajrang Power and Ispat Limited |
3,064.54 |
57.3 |
218.75 |
NA |
26.14% |
|
JSW Steel Limited |
80,431.00 |
32.91 |
193.46 |
20.71 |
16.92% |
|
Tata Steel Limited |
157,189.80 |
63.78 |
616.54 |
19.43 |
10.09% |
|
Jindal Steel & Power Limited |
39,527.60 |
35.63 |
311.9 |
11.07 |
16.57% |
|
Prakash Industries Limited |
3,223.90 |
5.55 |
161.89 |
14.77 |
3.29% |
|
Godawari Power & Ispat Limited |
4,076.00 |
181.17 |
577.7 |
8.03 |
31.36% |
|
Sarda Energy & Mineral Limited |
2,343.30 |
104 |
616.17 |
6.31 |
16.88% |
|
Kamadhenu Limited |
628.70 |
5.62 |
72.3 |
28.83 |
7.74% |
|
Tata Steel Long Products Ltd. |
4,828.20 |
126.83 |
575.2 |
7.91 |
22.05% |
|
Shyam Metalics and Energy Limited |
6,320.80 |
36.1 |
142.47 |
11.6 |
23.21% |
Key Points for Shri Bajrang Power and Ispat Ltd IPO -
IPO Key Points
-
Strengths
1. One of the leading integrated steel companies based out of central India.
2. Strategically located Units with robust infrastructure helps achieve cost optimization.
3. Diversified product mix with strong focus on value added products and well recognized brands.
4. Stablished market presence and relationships with channel partners supported by large distribution network.
5. Track record of growth in financial performance, remained profitable each year since 2005. -
Risks
1. The demand and pricing in steel industry is volatile and cyclical nature, hence fluctuations in steel prices, immediately effects the business.
2. Unavailability of raw materials for operations at competitive prices or in a timely manner.
3. There are outstanding legal proceedings against the company, subsidiaries, directors and promoter.
4. Disruption of logistics and transportation services could impair the ability of its suppliers to deliver raw materials or ability to deliver products to the customers and/ or increase transportation costs.
5. The firm has certain contingent liabilities are not provided for in the financial statements, which if they materialize, may adversely affected the financial condition.
6. Third party risks may kick in as the products are sold through a large network of channel partners, (distributors and dealers).
How to apply for IPO?
-
Login to your 5paisa account and select the issue in the
current IPO section -
Enter the number of lots and price at which you wish to
apply for -
Enter your UPI ID and click on submit. With this, your
bid will be placed with the exchange -
You will receive a mandate notification to block funds in
your UPI app -
Approve the mandate request on your UPI and funds
will be blocked
Open account in 5 minutes
Be a part of the 5paisa community now with 10 million mobile app users
IPO FAQs
What is the minimum lot size and investment required for the Shri Bajrang Power and Ispat IPO?
Shri Bajrang Power and Ispat IPO details are yet to be announced.
What is the price band of the IPO?
Shri Bajrang Power and Ispat IPO details are yet to be announced.
When does the Shri Bajrang Power and Ispat issue open and close?
Shri Bajrang Power and Ispat IPO details are yet to be announced.
What is the size of Shri Bajrang Power and Ispat IPO issue?
The IPO comprises a fresh issue of Rs.700 crores
Who are the promoters/key personnels of Shri Bajrang Power and Ispat?
Suresh Goel, Rajendra Goel, Narendra Goel, and Anand Goel, Atlanta Securities Private Limited (ASPL) and Banka Finance & Securities Private Limited. (BFSPL).
What is the allotment date of Shri Bajrang Power and Ispat?
Shri Bajrang Power and Ispat IPO details are yet to be announced.
What is the Shri Bajrang Power and Ispat listing date?
Shri Bajrang Power and Ispat IPO details are yet to be announced.
Who are the book runners for Shri Bajrang Power and Ispat IPO?
Equirus Capital Pvt Ltd and SBI Capital Markets Ltd are the lead managers to the issue.
What is the objective of the issue?
The proceeds will be used for
1. Prepaying existing debt of Rs. 400 crore and become debt-free on a standalone basis.
2. Use Rs. 120 crores for funding working capital requirements.
How to apply for the Shri Bajrang Power and Ispat IPO?
To apply for the IPO, follow the steps given below
1. Login to your 5paisa account and select the issue in the current IPO section.
2. Enter the number of lots and price at which you wish to apply for.
3. Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange.
4. You will receive a mandate notification to block funds in your UPI app.