About the company
Incorporated in 2004, Vraj Iron and Steel is engaged in the manufacturing of Sponge Iron, M.S. Billets, and TMT bars under the brand Vraj. The company’s product offerings such as Sponge Iron, TMT Bar, MS Billets, and by-products Dolochar, Pellet, and Pig Iron cater to a mix of customers that consist of industrial customers and end-users.
It operates through two manufacturing plants located at Raipur and Bilaspur in Chhattisgarh spread across 52.93 acres. As of December 31, 2023, the aggregate installed capacity of its manufacturing plants was 2,31,600 tons per annum (TPA) (comprising intermediate and final products). The manufacturing plant at Raipur also includes a captive power plant with an aggregate installed capacity of 5 MW. The company has also obtained Environment Management System Certification (EMSC) under the new standard of ISO 14001: 2015 for its Raipur Plant.
| Funds Raised in the IPO | Amount |
|---|---|
| Overall | ₹171 crores |
| Fresh Issue | ₹171 crores |
| Offer for sale | – |
Financial Snapshot
| Financial Year Ended | March 2021 | March 2022 | March 2023 | December 2023 |
|---|---|---|---|---|
| Total Assets | 126.33 | 150.77 | 191.54 | 253.05 |
| Revenue | 290.93 | 414.38 | 517.42 | 304.81 |
| Profit After Tax | 10.99 | 28.70 | 54.00 | 44.58 |
| EPS | 4.44 | 11.61 | 21.84 | 18.03 |
*All figures except EPS are in ₹ Crores
Risk factors
- Business cyclicality: The company generates 100% of its revenue through the sale of steel products like TMT Bars, MS Billets, Sponge Iron, and related items. The iron and steel industry is inherently prone to volatility in demand and pricing, exhibiting cyclical patterns. A decline in steel prices could significantly impact the business, operational outcomes, prospects, and financial stability.
- Client concentration and absence of long-term contracts: The company lacks long-term contracts with its customers and relies heavily on its top 10 clients for approximately 64% of its revenues. Any loss of, or substantial decrease in revenue from, one or more of these key clients would have a substantial adverse effect on the business, operational results, and financial standing.
IPO Schedule
| Issue Period | 26-28 Jun 2024 |
|---|---|
| Price band | ₹ 267 to 281 |
| Minimum Bid quantity | 53 & Multiples thereof |
| UPI Mandate Deadline | 5 PM, 28 Jun 2024 |
| Allotment Finalization | 01 July 2024 |
| Refund Initiation | 02 July 2024 |
| Share Credit | 02 July 2024 |
| Listing Date | 03 July 2024 |
| Mandate end date | 13 July 2024 |
| Lock-In End Date for Anchor Investors (50%) | 28 July 2024 |
| Lock-In End Date for Anchor Investors (Remaining) | 26 Sept 2024 |
Note:
- The above schedule is tentative. The anchor lock-in period ends 30 days after the actual allotment date for 50% of the shares and 90 days after for the remaining portion.
- The allotment status will be available by July 02, 2024, on the Registrar’s website and the NSE website.