Vibhor Steel Tubes IPO is a book built issue of Rs 72.17 crores. The issue is entirely a fresh issue.
| IPO opens | Feb 13, 2024 |
| IPO Closes | Feb 15, 2024 |
| IPO Size (Rs.) | ₹72.17 Cr |
| IPO Size (shares) | ₹72.17 Cr |
| Breakup | Fresh issue only |
| Face Value: | ₹10 per share |
| IPO Price in Rs. | ₹141 to ₹151 per share |
| Minimum Lot | 99 Shares |
| Listing At | NSE , BSE |
| QIB | ~50% |
| NII Quota | ~15 |
| Retail Quota | ~35% |
| Lead Manager | Khambatta Securities Limited |
| Registrar | Kfin |
About Vibhor Steel Tubes:
- Vibhor Steel Tubes is a 20 year old company.
- They are having 2 manufacturing plants in Raigad and Hyderabad with total capacity of 2.21 lakh MTPA.
- Vibhor Steel Tubes product portfolio includes:
- ERW pipes for application in water transport, oil, gas and other non-toxic supplies.
- Hot-dipped galvanized pipes for application in agriculture and infrastructure.
- Hollow section pipes in square and rectangular forms.
- Primer painted pipes
- Crash barriers for application in railways, highways, and roads.
- They have a tie-up with Jindal Pipes.
- The Promoters of the Company are Mr. Vijay Kaushik, Mr. Vibhor Kaushik, Mrs. Vijay Laxmi Kaushik and M/s. Vijay Kaushik HUF.
Vibhor Steel Tubes IPO: Financials
| Particulars (₹ in cr.) | 2023 (06) | 2023 (12) | 2022 (12) | 2021 (12) |
| Revenue from Operations | 530.51 | 1,113.12 | 818 | 510.47 |
| EBITDA | 23.69 | 46.84 | 30.18 | 19.92 |
| EBITDA Margin (%) | 4.47% | 4.21% | 3.69% | 3.90% |
| Profit before Taxes | 11.32 | 28.22 | 15.36 | 4.16 |
| PAT | 8.52 | 21.07 | 11.33 | 0.69 |
| PAT Margin (%) | 1.61% | 1.89% | 1.39% | 0.13% |
| Operating cash flow | -8.2 | 7.03 | -34.55 | 45.42 |
| Share Capital | 14.18 | 14.18 | 14.18 | 14.18 |
| Reserves | 87.57 | 79.01 | 57.79 | 46.31 |
| Net Worth | 101.76 | 93.2 | 71.97 | 60.49 |
| Net Debt | 160.27 | 126.83 | 106.07 | 58.74 |
| EPS – Basic & Diluted (₹) | 6.01 | 14.85 | 7.99 | 0.49 |
| ROE (%) | 8.37% | 25.51% | 17.11% | 1.14% |
| ROCE (%) | 6.97% | 16.48% | 12.09% | 9.90% |
| Post issue Share Capital | 19 | |||
| FV | 10.0 | |||
| IPO price | 151.0 | |||
| EPS Fy23 | 14.9 | |||
| PE Fy23 | 10.2 | |||
| EPS Fy24 (annualized) | 11.9 | |||
| PE Fy24 (annualized) | 12.7 | |||
| Market cap in cr | 286.9 | |||
| Market cap / Sales | 0.26 |
Anchor: Vibhor Steel Tubes IPO
Vibhor Steel Tubes IPOs: Salient Points
- The company is working with Jindal Pipes since 2003. It has a long-term agreement for the six years
- It derives 90% of its revenues from Jindal Pipes.
- Net Debt equity ratio, post IPO, will be stand at 0.9:1.
- Company’s credit rating of BBB+ also reflects this high debt.
- Vibhor Steel Tubes has been granted an allotment letter for land to establish a new facility in Odisha. Odisha state is the largest market for iron and this could help the company with raw material at compettive prices.
- In FY23, it reported 36 per cent yoy-year growth in revenue compared to FY22, while net profit was up 86 per cent.
- Peers:
- Rama Steel Tubes with Sales of 1265 core and Net Profit margin 2.65% is trading at a PE of 61.8x.
- Hi-Tech Pipes with Sales of 2194 core and Net Profit margin 1.89% is trading at a PE of 46.40x.
- Vibhor Steel Tubes with Sales of 1,113 core and Net Prifit margin 1.89% is trading at a PE of 12x.
- Vibhor Steel Tubes IPO is coming at a PE ratio of 10.2x (fy23) & 12x( fy24 ) annualized earnings. It reported loss in FY23.
- I intend to apply in Vibhor Steel Tubes IPO. Vibhor Steel Tubes IPO has been priced lower than valuations commanded by Peers. Further it has a strategic association with Jindal Pipes.
- GMP as heard on Social Media may be around Rs. 130.
- 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.