Atmastco IPO (NSE SME) Review

Atmastco Limited is engaged in the business of executing Turnkey / Engineering, Procurement, and Construction (EPC) contracts in ferrous and non- ferrous sector. Atmastco IPO aims to raise Rs. 56.25 crores. The issue is a combination of fresh issue of 54.8 lakh shares aggregating to Rs 42.20 crores and offer for sale of 18.26 lakh shares aggregating to Rs 14.06 crores.

IPO opensFeb 15, 2024
IPO ClosesFeb 20, 2024
IPO Size (Rs.)₹56.25 Cr
IPO Size (shares)7,305,600 shares
BreakupFresh issue ₹42.20 Cr + OFS ₹14.06 Cr
Face Value:₹ 10
IPO Price in Rs :₹77 per share
Minimum Lot1600 Shares
Listing AtNSE SME
NII Quota~50%
Retail Quota~50%
 Lead ManagerAffinity Global Capital Market
RegistrarCameo Corporate Services
Market makerAsnani Stock Broker

About Atmastco IPO:

  • Company is engaged in the business of executing Turnkey / Engineering, Procurement, and Construction (EPC) contracts in ferrous and non- ferrous sector and provide end-to-end solutions offering multi-disciplinary services and project management solutions.
  • As an Engineering services company it is engaged in the business of:
    • EPC : We have forayed into the business of providing engineering, procurement and construction (“EPC”) services in ferrous and non-ferrous sector in the year 2020. We have acquired business of Rs. 65,00,000 Thousands in the last 3 (three) years in verticals like Metal (ferrous & non-ferrous), Oil & Gas, Air Pollution Control,        Lime & associated processing.
    • Steel Fabrication: We are engaged in the business of design, manufacturing and supply of precision equipments and heavy fabrication structures for various industrial use. We undertake designing, Engineering, Fabrication and Erection work for our clients as per their specifications        and customizations.
    • Defence (Wholly owned Subsidiary): They have incorporated a separate legal entity Atmastco Defence Systems Private Limited on July 22, 2020 to carry on the business of manufacture of bullet proof jackets & helmets and paramilitary forces. especially for military application and full body protector for female troops and related activities.

Financials: Atmastco IPO

Particulars / Rs. LacsAug 31, 23Fy23Fy22Fy21
Total Revenue6700.15824278.75629468.14266990.6787
Profit / (Loss) after tax642.91791277.7471323.00460.457
Equity Share Capital1481.131481.131481.131481.13
Net Worth6259.02935520.33144235.23433912.2303
Earnings per share4.348.632.180.41
Net Asset Value42.2637.2728.5926.41
Total borrowings7317.467125.6825155.91745410.4789
Post issue Share Capital2,474   
FV10   
IPO price77   
EPS Fy235.2   
PE Fy2314.9   
EPS Fy24 (annualized)6.2   
PE Fy24  (annualized)12.3   
Market cap in Lacs19,049.8   
Market Cap/sales12.9   

Atmastco IPO: Salient Points

  •  Company intends to utilize the Net Proceeds from the Fresh Offer for the following objects
Sl. No.ParticularsAmount in ‘1000s
1.To meet working capital expenses1,17,763.00
2.To make prepayment or repayment of all or a portion of certain secured and unsecured loans availed by the Company1,04,068.00
3.General Corporate Purpose #1,32,615.40
4.To meet Offer Expenses67,513.60
Total proceeds4,21,960.00
  • Segment wise revenue details
  • Key Performance Indicators of Company
Key Financial PerformanceSeptember 30, 2023March 31, 2023March 31, 2022March 31, 20201
Revenue from Operations 18988.5024959.878862.414226.80
EBITDA 2166.261858.18612.48300.47
EBITDA Margin 11.41%7.44%6.91%7.11%
PAT1136.481026.87375.33177.59
PAT Margin 5.99%4.11%4.24%4.20%
Net Worth5192.744062.212831.832456.48
RoE(%)24.56%29.79%14.19%7.52%
RoCE (%)21.46%22.90%17.57%8.96%
  • They make fabricated steel structures for Railways bridges & take up many EPC projects booth in ferrous and non-ferrous segments.
  • Clients: These span across industries including power plants, refineries, steel plants, Railways, cement plants, Industrial and Infrastructure, Chemicals, Pharmaceuticals, Petrochemicals, Refineries, Power, Oil & Gas etc. like Vedanta, EIL, Adani Copper, BHEL, SAIL, NMDC, EIL, TCS, Jindal Stainless steel etc.
  • About 40% business form PSUs/Govt Bodies, rest private.
  • Products:
Sr. No.Product CategoryName of ProductProduct DescriptionIndustrial Usage
1Heavy StructuresCeiling Girder, Columns, Box ColumnsPrimary StructuresCore industries – ferro alloys, cement, steel, power
2Pipe Rack StructuresBeams, Bracings, PostSecondary StructuresUtility Corridors
3Technological StructuresKiln Shell, Lime Discharge system, Hopper, bunker shells, SilosEquipment structuresLime Kiln, Coal Handling, Mining
4Conveyor GalleriesTower, Trestles, FramesGeneral                  Fabrication structuresPower, cement, coal mining, etc.
5Pre-Engineered BuildingColumn, Purlin, Truss, V Brace, H BraceBuilding structuresWarehouses & steel buildings
  • Some Completed projects include
  • Atmastco Defence System Private Limited has not yet commenced production.
  • As per some indications by management they could clock 380-499 cr revenues in FY24.
  • Due to location they have access to quality steel from Bhilai steel plant and others for their needs.
  • To enhance margin they are now giving importance to non ferrous area.
  • Peers: No listed Peers
  • Their debt to equity ratio as on March 31, 2023 was 0.48  on a consolidated restated basis
  • Company has good orders in hand. The contract -wise details of work in hand as per the Order book of Company as of January 31, 2024, is set out below:
Sr No.ContractNo. of Ongoing ProjectsContracts value(Rs. cr)
1Engineering, Procurement & Construction Projects7691
2Engineering, Procurement & Supply Projects244
3Manufacturing/ Fabrication of Heavy structures57
.Total14742
  • Atmastco IPO is coming at a PE ratio of 14.9x(fy23 earnings) and 12.3x (fy24 annualized earnings)
  • I may apply in Atmastco IPO subject to availability of funds & looking at overall response on last day. It is a risky bet. Company has good record of execution. has good orders in hand and IPO is not priced exorbitantly. Iam slightly positive on the company based on performance and products; have concerns on High issue expenses of 675 Lacs and GMP , subscription till now do not support this thesis.
  • GMP as reported on social media has been Rs. 6 .
  • Affinity Global Capital Market Pvt. Ltd. is the Lead Manager to the issue with little and quite average record. Past issues handled by them include Jiwanram Sheoduttrai Industries, Auro Impex & Chemicals Limited.
  • SME IPO are much more risky and volatile than mainboard IPOs.
  • Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.

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