Owais Metal and Mineral (NSE SME) IPO Review

Owais Metal and Mineral Processing Ltd. is the manufacturer and processor of various metals and minerals including products Manganese Oxide (MNO), MC Ferro Manganese, Wood Charcoal, and processing minerals like Ferro Alloy, Quartz, and Manganese Ore. Owais Metal and Mineral IPO | Owais Metal and Mineral Processing IPO plans to garner Rs 42.69 crores. The issue is entirely a fresh issue of 49.07 lakh shares.

IPO opensFeb 26, 2024
IPO ClosesFeb 28 2024
IPO Size (Rs.)₹42.69 Cr
IPO Size (s hares)4,907,200 shares
BreakupFresh issue only
Face Value:₹ 10
IPO Price in Rs :₹83 to ₹87 per share
Minimum Lot1600 Shares
Listing AtNSE SME
QIB50%
NII Quota~15%
Retail Quota~35%
 Lead ManagerGretex Corporate Services
RegistrarBigshare Services Pvt Ltd
Market makerGretex Share Broking.

About Owais Metal and Mineral Processing Limited:

  • Owais Metal and Mineral Processing Ltd is a manufacturer and processor of various metals and minerals. Uniquely diversified across the broad spectrum of natural resources with main interests in manufacturing and processing metal and minerals. The company is engaged in the manufacturing of the following products;
    • Manganese Oxide (MNO)
    • MC Ferro Manganese
    • Manufacturing of Wood Charcoal.
    • Processing of Minerals such as Ferro Alloy, Quartz and Manganese Ore.
  • Company has a manufacturing unit for wood charcoal at Rajasthan and Meghnagar, Jhabua in MP. Processing of Quartz is been done through Meghnagar plant.
  • Saiyyed Owais Ali, Sayeed Akhtar Al and Saiyeed Murtaza Ali are the promoters of the company..

Financials: Owais Metal and Mineral Processing IPO | Owais Metal and Mineral IPO

Particulars /Rs. LacsDec 31, 2023Mar 31, 2023
Total Income3,977.540
Profit after Tax765.47-12.72
Other Financial Information  
Share Capital1,327.5213
Reserves and surplus795.2544.28
Net Worth2,122.7757.28
Basic & Diluted EPS3.01-0.1
Return on Net worth (%)36.06%-22.22%
Net Asset Value8.340.46
Total Borrowings1,350.59321.29
Post issue Share Capital1818 
FV10.0 
IPO price87.0 
EPS Fy24 (annualized)5.6 
PE Fy24  (annualized)15.5 
Market cap in cr15,816.6 
Market cap / Sales2.98 

Owais Metal and Mineral Processing IPO | Owais Metal and Mineral IPO: Anchors

Owais Metal and Mineral Processing IPO | Owais Metal and Mineral IPO: Salient Points

  • Manganese Oxide is used in fertilizer industry and is also used by the Manganese Sulphate Plants.
  • Manganese Ore is used in manufacturing of Ferro Manganese, Silico Manganese, Manganese Oxide, Batteries and other Ferro products also it can be directly sellable in the market.
  • MC Ferro Manganese is used in steel and casting industries, as it assists in removing sulphur from steel and improve properties, like durability, machinability and malleability. It can deoxidize molten metal.
  • Wood Charcoal is used in furnaces of industries which requires high heat for their manufacturing process such as Steel industry. Processed Quartz is being used hotel industry, Ferro Alloys industry, tiles & ceramic industry, glass industry and industry of interiors & furniture.
  • As on date of filing Red Herring Prospectus their major products are been supplied to the state of Madhya Pradesh, Maharashtra and Gujrat with major portion of our revenue is from sale in the state of Madhya Pradesh.
  • Company intends to utilize the Net Proceeds the net proceeds of the IPO funds for these objectives.
ParticularsAmount
Purchase of Plant and Machinery for manufacturing1,977.49
Working Capital Requirements1,800.00
General Corporate Purpose[●]
  • Company meets its demand of raw material i.e., Manganese Ore, Wood, Quartz and other minerals, etc. by purchasing the same from the domestic market.
  • Product wise sale
YearManganese OxideMC ManganeseQuartz*Wood CharcoalOther ProductsProcessing Ferro Alloys
FY 2020-2021427.45207.811,452.83
FY 2021-20221,380.041,098.5520.68299.95
FY 2022-20231,045.11555.22508.0360.741,776.51
01.04.2023- 31.12.20230820.52639.581041.771251,325.14
  • Majority of their revenue is dependent on two products i.e., MC Manganese and Processing if Ferro Alloys.
  • Company has recently added new products to its portfolio. These products are Wood Charcoal and Processed Quartz.
  • Key Performance Indicators of Company
Key Financial PerformanceOwais  Metal  and Mineral Impex Ferro Tech Indian Metals & Ferro Alloys
 December 31, 2023FY 2022-23FY 2022-2
Revenue from Operations(3,952.0214,338.172,67,639.00
EBITDA1,195.31(3,907.24)51,448.00
EBITDA Margin30.25%(27.25%)19.22%
PAT765.47(3359.8)22,573.00
PAT Margin19.37%(23.43%)8.43%
Networth2,122.77(27,826.13)1,85,700.00
RoE %70.23%0.00%12.14%
RoCE% 41.73%354.20%20.66%
  • In addition to direct sales of products to end user customers, they have an extensive dealer network covering major parts of India.
  • They intend to utilize part of IPO proceeds to achieve better automation.
  • As of December 31 2023, Company’s Order Book was ₹ 1,671.75 Lakh.
  • Factory is situated in Meghnagar, Jhabua, MP which is a Strategic location as it is situated on the border of Gujarat, Madhya Pradesh and Rajasthan. Gujarat, Madhya Pradesh and Rajasthan are the three major consumers of Manganese oxide and MC Ferro Manganese. This location helps them to minimize transportation cost.
  • Owais Metal and Mineral Processing IPO | Owais Metal and Mineral IPO is coming at a PE ratio of 15x(fy24 annualized earnings)
  • I intend to apply in Owais Metal and Mineral Processing IPO | Owais Metal and Mineral IPO subject to availability of funds. It is difficult to properly asses the company for me due to the sector and limited data and short history of company.
  • GMP as reported on social media has been Rs. 110 .
  • Gretex Corporate Services Limited is the Lead Manager with a fair to good record. Past issues handled by them include Interiors and More Limited, AMIC Forging Limited, Kalyani Cast Tech Ltd, Transteel Seating Technologies Limited, Shelter Pharma Limited, Comrade Appliances Limited, Innokaiz India Limited Retina Paints Limited, Sudarshan Pharma Industries, ResGen Limited, Reetech International Cargo and Courier Ltd, Steelman Telecom Limited, Shantidoot Infra Services.
  • 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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