Vraj Iron and Steel's IPO launches tomorrow. Here’s a quick rundown: find out about the issue details, GMP, and the 10 essential things you need to know.
Vraj Iron and Steel's IPO subscription begins tomorrow, June 26. Operating under the Vraj brand, the company manufactures sponge iron, M.S. Billets, and TMT bars across two industrial sites spanning 52.93 acres in Raipur and Bilaspur, Chhattisgarh. As of December 31, 2023, their Raipur facility includes a 5 MW captive power plant.
The company is expanding its manufacturing and power capacities, expecting to increase total production capacity from 2,31,600 TPA to 5,00,100 TPA for intermediate and final products. Simultaneously, the captive power plant's capacity is set to rise from 5 MW to 20 MW.
Vraj Iron and Steel caters to both industrial and end-user clients with a product portfolio that includes Sponge Iron, TMT Bars, MS Billets, and by-products like Dolochar, Pellet, and Pig Iron.
Promoters of the company include Vijay Anand Jhanwar, V. A. Transport Private Limited, and Gopal Sponge and Power Private Limited. Between March 31, 2022, and March 31, 2023, the company reported an 88.12% increase in profit after tax (PAT) and a 24.87% rise in revenue.
The price range for the Vraj Iron and Steel IPO has been fixed at Rs.195 to Rs.207 per share.
The IPO of Vraj Iron and Steel, scheduled to open on June 26, has set its price band at Rs.195 to Rs.207 per equity share. The company aims to raise Rs.171 crore through this offering, exclusively through a fresh issue of 0.83 crore shares.
Proceeds from the IPO will fund capital expenditure for the Expansion Project at the Bilaspur Plant, repay or prepay borrowings from HDFC Bank used for capital expenditure at the Bilaspur Plant, and for general corporate purposes.
The IPO will follow the book-building process, with up to 50% of the net issue allocated to qualified institutional buyers, 15% to non-institutional investors, and a minimum of 35% to retail investors. The minimum lot size for retail investorsF is one lot (72 shares), requiring a minimum investment of Rs.14,904. Small non-institutional investors (SNIIs) must invest in a minimum of 14 lots (1008 shares), totaling Rs.208,656.
Aryaman Financial Services Limited is the book-running lead manager, and Bigshare Services Pvt. Ltd. is the registrar for the IPO.
Vraj Iron and Steel manufactures sponge iron, M.S. billets, and TMT bars under the Vraj brand, distributing its products directly and through brokers and dealers. It operates manufacturing plants in Raipur and Bilaspur, Chhattisgarh, covering 52.93 acres. As of March 31, 2023, the total installed capacity of its manufacturing plants was 2,31,600 tons per annum (TPA), comprising intermediate and final products.
The company is expanding its manufacturing and captive power plant capacities, aiming to increase its total installed capacity (comprising of intermediate and final products) to 5,00,100 TPA and the captive power plant's capacity to 20 MW. The expansion is expected to be operational in the current fiscal year.
Vraj Iron and Steel currently operates a 5 MW captive power plant to reduce energy costs and mitigate production disruptions during power outages.