Vibhor Steel Tubes is set to launch its Initial Public Offering (IPO), showcasing its expertise as a manufacturer and exporter of Mild Steel/Carbon Steel ERW Black and Galvanised Pipes, Hollow Steel Pipe, and Cold Rolled Steel (CR) Strips/Coils. The IPO marks a significant milestone for the company, highlighting its commitment to expansion and growth in the steel industry. Investors are keenly observing the Vibhor Steel Tubes IPO, recognising the potential of the company in the market.
| Parameter | Details |
|---|---|
| IPO Open Date | Feb 13, 2024 |
| IPO Open Date | 15 Feb 2024 |
| Allotment Date | 16 Feb 2024 |
| Listing Date | 20 Feb 2024 |
| Face Value | ₹10 per share |
| Price Band | ₹141 to ₹151 per share |
| Lot Size | 99 Shares |
| Total Issue Size | [.] shares (aggregating up to ₹72.17 Cr) |
| Fresh Issue | [.] shares (aggregating up to ₹72.17 Cr) |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE, NSE |
| Share holding pre issue | 14,183,000 |
Checkout the List of Upcoming IPO.
Vibhor Steel Tubes Ltd. (VSTL) stands as a stalwart in the steel industry, boasting two decades of expertise in manufacturing and exporting a diverse range of steel pipes and tubes. These products find applications in various heavy engineering industries across India, catering to needs ranging from frames and shafts to bicycle frames and furniture. VSTL prides itself on offering a wide spectrum of steel pipes and tubes, available in square, round, rectangular, elliptical, or custom shapes, meeting the specific demands of its clientele.
A notable collaboration with Jindal Pipes Limited since 2003 underscores VSTL's credibility, with the company manufacturing and supplying finished goods under the renowned brand name "Jindal Star." This partnership, solidified by a renewed agreement in April 2023, extends over six years, ensuring a substantial order quantity of 1,00,000 MT per annum. Crucially, while the agreement is non-exclusive, VSTL retains the flexibility to explore opportunities in the open market without brand restrictions.
With 630 dedicated employees, VSTL is poised to seize significant opportunities in both domestic and export markets, leveraging its robust production capabilities and market flexibility to sustain growth even in the face of potential disruptions.
| Strengths | Risks | ||
|---|---|---|---|
| Association with JPL: The long-standing relationship with Jindal Pipes Ltd (JPL) secures a stable revenue stream and a significant order quantity, providing a foundation for growth. | Inconsistent Cash Flows: Highly volatile operating cash flows, evidenced by significant fluctuations between FY20 and FY21, pose challenges for sustainable financial management. | ||
| Strategic placement of Ports: Proximity to ports, particularly in Maharashtra, enables efficient export operations directly from Unit 1, enhancing competitiveness in global markets. | Revenue Concentration: Heavy reliance on JPL for revenue generation creates concentration risk, limiting diversification opportunities and potentially impacting business stability. | ||
| Well-developed distribution: An extensive distribution network spanning over 10 countries under the brand Jindal Star signifies strong market penetration and potential for future expansion. | Razor Thin Margins: Escalating raw material costs, reflected in FY23's high raw material-to-revenue ratio, challenge profitability, with the company struggling to achieve substantial margins. | ||
| Integrated Manufacturing Facility: State-of-the-art tools and machinery across manufacturing units and warehouses optimize production efficiency, ensuring high-quality steel tube manufacturing. | Working Capital Requirement: A substantial working capital requirement, as seen in FY24, necessitates significant debt accumulation, indicating potential strains on financial liquidity and leverage ratios. | ||
| Stable Balance Sheet: Demonstrated capacity utilization improvements and margin scaling contribute to a stable revenue trajectory, underscoring the company's ability to navigate market dynamics effectively. | to Trade Receivables & Inventories: Heavy reliance on trade receivables and inventories as a significant portion of current assets exposes the company to liquidity risks and operational inefficiencies in managing inventory turnover and receivable collections. | ||
| Particular | As at 31 March 2021 | As at 31 March 2022 | As at 31 March 2023 |
|---|---|---|---|
| Revenue (₹ in lakhs) | 51,046.68 | 81,799.60 | 1,11,311.90 |
| Equity (₹ in lakhs) | 6,048.99 | 7,197.29 | 9,319.79 |
| Expenses (₹ in lakhs) | 50,734.97 | 80,311.85 | 1,08,615.46 |
| Profit and Loss After Tax (₹ in lakhs) | 68.83 | 1,133.11 | 2,106.62 |
| RoNW (%) | 1.14 | 15.74 | 22.6 |
| Diluted EPS only (₹) | 0.49 | 7.99 | 14.85 |
| Total Assets (in lakhs) | 17,293.37 | 24,853.56 | 29,363.00 |
| Total Liabilities (in lakhs) | 11,244.37 | 17,656.27 | 17,656.27 |
| NAV (in lakhs) | 42.64 | 50.74 | 65.71 |
| Debt Equity Ratio | 1.23 | 1.77 | 1.63 |
| Current Ratio | 1 | 1.23 | 1.25 |
| Inventory Turnover Ratio | 8.08 | 10.61 | 9.49 |
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An IPO also known as initial pulic offering or stock launch is a process when a private company sale its shares to public for the first time. Learn more about IPO at our knowledge centre.
A lot size is the minimum number of shares that an investor has to bid for. A lot size differs for each IPO and is fixed by the company.
IPO Price Band is the price range within which investors can bid for the shares. The minimum price is called the floor price and the maximum price is called the cap price.
Issue size is the total value of an IPO. It is calculated by multiplying the number of shares offered by the company by the issue price per share.
You will receive an email on your registered email id if the IPO shares are allotted to you. Alternatively, you can also visit the registrar of the company’s official website and provide the details as asked in the allotment status section of the website.
IPOs, as such, do not have any taxes. You are taxed only when you decide to sell the IPO shares. Any monetary profit you make while selling the IPO shares is referred to as ‘capital gains’.
Capital gains tax is charged depending on how long you held the shares for. If you owned the shares for less than 12 months, it is considered as short-term capital gains and if it is over 12 months, it is referred as long-term capital gains.
Tax on short-term capital gains is 15%. It is 10% for equity gains in the long run (over 12 months). Do remember that you are taxed if the equity proceeds exceed Rs 1 lakh.
Vibhor Steel Tubes IPO, with a face value of Rs. 10 per share and a price band of Rs. 141 to Rs. 151, offers 47.79 lakh fresh shares, totalling Rs. 72.17 crore. No OFS component. Listing on NSE and BSE. Proceeds for working capital and corporate purposes. Promoter stake to dilute from 98.24% to 73.48%. Lead manager: Khambatta Securities Ltd. Registrar: KFIN Technologies Ltd.
The price band for Vibhor Steel Tubes IPO. is set at Rs. 141 to Rs. 151 per share, indicating the range within which investors can bid for shares during the IPO. This price band reflects the valuation range determined by the company and its underwriters based on market conditions and financial performance.
The minimum lot size for Vibhor Steel Tubes Ltd. is 99 shares. This signifies the smallest number of shares that investors can bid for or purchase during the IPO process. It establishes the baseline for participation in the offering and reflects the company's strategy for distributing its shares among investors.
The minimum investment required for Vibhor Steel Tubes Ltd. is approximately Rs. 13,959, calculated based on the minimum lot size of 99 shares and the lower end of the price band at Rs. 141 per share. This amount represents the minimum financial commitment for investors to participate in the IPO.
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