Surani Steel Tubes Limited will be entering capital market with an Initial Public Offering opening on January 25 and closing on January 29.
The company is offering 24,84,000 shares of Rs. 10 each for cash in the price band of Rs.51-52 per equity share aggregating to Rs. 12.91 crore. Minimum application is to be made for 2000 shares and in multiples thereon. Post allotment, shares will be listed on NSE SME Emerge.
The Company is engaged in the manufacturing of electric resistance welding (ERW) mild steel (MS) pipes in various specifications and sizes ranging from 20NB to 100NB.
The manufacturing plant of Surani Steel Tubes Limited is located at Dahegam, Gandhinagar in Gujarat having an installed capacity of 25,000 MT per annum. In FY18, the Company has processed 23792 MT of ERW MS Pipes. The company is setting up a new manufacturing facility for ERW MS Pipes in various specifications and sizes ranging from 100NB to 300NB.
This will help the company to strengthen its customer base by satisfying the diverse requirements of its customers. It has entered into arrangements with over 300 dealers across Gujarat for selling & marketing its products.
The company is operating at around 95% of its capacity in FY18. It plans to increase production capacity from 25,000 MT to 40,000 MT per annum, which will enable to enter into growth phase.
Mukesh Patel, Dinesh Patel, Karshan Patel, Prakash Patel, Mani Patel, Karsanbhai Devjibhai Patel HUF & Prakash Karsanbhai Patel HUF are the Promoters of the Company.
The financial performance of the Company has been robust. Top line has grown at a CAGR of 29.37% during FY14 – FY18, while the bottom line has clocked a stupendous CAGR of 119.80% during FY15 – FY18. EBIDTA has improved at CAGR of 33% during last 5 years. Debt-to-equity has come down to 1.38 on FY18 from 4.30 in FY 14.
Operating cycle has shown a modest increase, rising to 50 days in FY18 from 41 days in FY14. Its return on net worth is Rs.16.56, which is better than its established peers.
Pantomath Capital Advisers Pvt. Ltd. is the sole Lead Manager of the issue and Link Intime India Pvt. Ltd. is the Registrar to the issue.