Refractory Shapes Limited manufactures various types of Bricks, Castables, high alumina catalysts and Ceramic Balls. Refractory Shapes IPO is all set to raise Rs 18.60 crores. The issue is entirely a fresh issue of 60 lakh shares.
IPO opens
May 06, 2024
IPO Closes
May 09, 2024
IPO Size (Rs.)
₹18.60 Cr
IPO Size (shares)
6,000,000 shares
Breakup
Fresh issue only
Face Value:
₹ 10
IPO Price in Rs :
₹27 to ₹31 per share
Minimum Lot
4000 Shares
Listing At
NSE SME
QIB
~50 %
NII Quota
~15%
Retail Quota
~35%
Lead Manager
Shreni Shares Limited
Registrar
Bigshare
Market maker
Shreni Shares
About Refractory Shapes Limited:
Company was founded in 1996 and they are engaged in the manufacturing of different types of Bricks, Castables, High Alumina Catalyst and Ceramic Balls which includes Pre Cast & Pre Fired Blocks (“PCPF”), Burner Blocks, Special shaped Refractory bricks, Dense & Insulating Castables & Mortars.
The tailored made products shaped by the Company finds its application in a diverse range of Industries, including Steel, Refineries, Fertilizers, Petrochemicals, Glass, Cement etc.
The company’s refractories are engineered to endure the harsh conditions of these industries, contributing to enhanced operational efficiency and extended equipment life, the tailored made finished goods provide diversity in the products being manufactured by the Company wherein modern manufacturing equipment are installed for scaling the manufacturing.
In addition to the manufacturing activity being carried out by the Company, Refractory Shapes is often involved in receiving orders for those items from clients which are not a part of Company’s operations in manufacturing activities. These items include Metallic Anchors which are used as support for installing refractory castables for which Raw Materials such as tabular alumina, low alumina bricks and insulation bricks, etc are required, For such orders, company procures these items from their approved vendors and sells to the clients and thus Company is also involved in trading of the aforesaid products.
The company has a fully equipped plant and is situated in Pune.
In 2021 Refractory Shapes Commissioned an additional plant (expansion unit) at Wankaner, Gujarat.
The company’s promoters are Mr. Dayashankar Krishna Shetty, Ms. Pratibha Dayashankar Shetty, and Ms. Prajna Shravan Shetty.
Financials: Refractory Shapes Limited
Particulars/ Rs Lacs
9m Dec 2023
2022-23
2021-22
2020-21
Total Revenue
2,999.04
3,872.23
2,621.67
2,179.67
Profit after Tax
307.94
191.74
287.04
156.39
Share Capital
1,580.00
10
10
10
Net worth#
396.58
1,668.64
1,476.90
1,189.86
EPS (Basic & diluted)
0.97
1.21
1.82
0.99
Net Asset Value
6.26
10.56
9.35
7.53
Total borrowings
2,341.80
2,048.63
1,570.12
1,234.18
Post issue Share Capital
2180
FV
10.0
IPO price
31.0
EPS Fy23
0.9
PE Fy23
35.2
EPS Fy24 (annualized)
1.9
PE Fy24 (annualized)
16.5
Market cap in Lacs
6,758
Market cap / Sales
1.75
Anchors: Refractory Shapes IPO
Refractory Shapes IPO: Salient Points
Refractory Shapes Ltd is a pioneer in manufacturing Dome Bricks, Hexagonal Tiles, Circle Bricks, Alumina Lumps of High Purity for Fertilizer Industries and Specialized design PCPF Blocks for Burner Ports in Steel Industries.
It has a srong track record of performance for making excellent quality import equivalent refractories which includes Burner blocks, Bricks, Castables, etc for various industries.
Client List:
From the net proceeds of IPO, they will:
utilize Rs. 4.30 cr. for expansion of their existing unit
Rs. 2.51 cr. for purchase of new plant and machinery
Rs. 7.00 cr. for repayment/prepayment of borrowings
Rs. 0.11 cr. for purchase of commercial vehicle,
rest for general corporate purposes.
Peers:
Company
CMP (₹)
Revenue(₹cr)
Net Profit(₹ cr)
NPM %
PE
Macp/sales
RONW
Refractory Shapes
31
38.7
1.9
5.0%
35(16.5)
1.8
11.49
S P Refractories
208
27.2
0.62
2.3%
30.4
1.4
7.13%
IFGL Refractories
659
1,386
79
5.7%
24.1
1.47
10.12%
Rising domestic demand in key industries it serves.
Refractory Shapes IPO is coming at a PE ratio of 35x (FY23 Earnings) and 16.5x (fy24 annualized earnings)
I intend to apply in Refractory Shapes IPO subject to availability of funds.
GMP as reported on social media has been Rs. 13.
Shreni Shares Private Limited is the lead manager with quite a decent record of good listing and performance subsequently. Past issues handled by them include Yash Optics & Lens, Gabriel Pet Straps Limited, DelaPlex Limited, Net Avenue Technologies Limited, Swashthik Plascon Limited, KK Shah Hospitals Limited, Marco Cables & Conductors Limited, Meson Valves India Limited, C P S Shapers Limited, AccelerateBS India Limited, Global Pet Industries Limited, Veefin Solutions Limited, Sancode Technologies Limited, Bright Outdoor Media Limited, Srivasavi Adhesive Tapes Limited, Arihant Academy Limited, PNGS Gargi Fashion Jewellery Limited, DAPS Advertising Limited, Olatech Solutions Limited etc.
SME IPO are much more risky and volatile than mainboard IPOs and may not be suitable at least for new retail investors.
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.
