Vraj Iron IPO listed @ Rs. 240

July 3, 2024 admin Leave a reply Post Comment

Vraj Iron IPO GMP, Details, Guidance, Subscription Status, allotment @ Chanakyanipothi.com
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Table of Contents

• GMP
• Reviews
• Subscription
• Allotment

What is the business of Vraj Iron IPO?

The Company is engaged in manufacturing of Sponge Iron, M.S. Billets, and TMT bars under the brand Vraj.
It currently operates through two manufacturing plants which are located at Raipur and Bilaspur in
Chhattisgarh spread across 52.93 acres. As of March 31, 2023, the aggregate installed capacity of its
manufacturing plants was 2,31,600 tons per annum (“TPA”) (comprising of intermediate and final products).
Its manufacturing plant at Raipur also includes a captive power plant with an aggregate installed capacity of 5 MW, as of March 31, 2023. It is in the process of increasing the capacities of its existing manufacturing plants and captive power plant, which is expected to increase its aggregate installed capacity (comprising of intermediate and final products) from 2,31,600 TPA to 5,00,100 TPA and captive power plants aggregate installed capacity from 5 MW to 20 MW. These proposed expansions are expected to become operational in FY 2024-25.

As of June 30, 2023, it had a workforce of 533 comprising of 298 permanent employees including 4 Directors comprising 7 employees at the Registered Office, 200 employees at Raipur Plant and 87 employees at Bilaspur Plant and 235 contract workers.

The Company has a captive power plant with installed capacity of 5MW which helps it to reduce energy cost. Additionally operating a captive power plant will decrease its exposure to disruptions to the electricity grid in times of power outages that can otherwise lead to costly production disruptions.

For more information, click www.vrajtmt.in 

Vraj Iron IPO GMP, Particulars & Guidance

Vraj Iron IPO Guidance* by Paresh Gordhandas, CA & Research Analyst.
The Company is engaged in manufacturing of Sponge Iron, M.S. Billets, and TMT bars under the brand Vraj.
It currently operates through two manufacturing plants which are located at Raipur and Bilaspur in
Chhattisgarh spread across 52.93 acres. As of March 31, 2023, the aggregate installed capacity of its
manufacturing plants was 2,31,600 tons per annum (“TPA”) (comprising of intermediate and final products).
Size: The size of the IPO is only Rs. 171 crore with retail portion only of 59.85 crore. With 40157 applications, retail portion will get one time subscribed. There are all chances of huge oversubscription in Retail and NII categories.
Financials: The company has shown EPS of Rs. 21.84 for the year 2022-23, However the bonus issue was in the ratio 4:1 (For every 1 (one) Equity Share held by its the then shareholders 4 (four) Equity Shares were allotted to them) on September 29, 2023.So, we have to rework the EPS for the year and also book value as on 31.03.2023. Because of the bonus issue, the equity share capital has increased to 24721750 from 4944350 shares as per balance sheet of 31.03.2023 and the EPS get diluted to Rs.21.84. The shares are offered at PE multiple of 9.47. So there is some room for listing gains. Chances of allotment are very low and yet you may try and apply.
Strategy seen in the grey market: At present the premium being quoted in the grey market is very insignificant and the premium market-experts expect the premium to show rising trend once the IPO opens for subscription. 
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