Lead Reclaim and Rubber Products Limited IPO

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i. Lead Reclaim and Rubber is in the business of manufacturing of reclaimed rubber, crumb rubber powder and rubber granules. The Company focus on
a) saving valuable natural resources by way of recycling; and
b) helping its customers fulfil their circularity aspirations through use of the reclaimed rubber products.

ii. They believe that they are one of the few companies in the reclaimed rubber industry that can process radial rubber, scrap tyre and tube rubber. Their manufacturing facility is situated at 856/4, Sarali Road Village – Pithai, Taluka- Kathalal, Kheda – 387630, Gujarat, which is spread over a total land area of approximately 7790 Sq. mts. with the existing plant occupying approximately 2253 Sq. mts with the total install capacity of 5520 metric tons. The manufacturing facility employs an extensive and stringent quality control mechanism at each stage of the recycling process to ensure that the finished product conforms to the exact requirement of their customers.

iii. Company’s Product Portfolio offers a diversified product range which includes variety of grades, thickness, widths and standards of various grades of whole tyre reclaim rubber, butyl reclaim rubber and natural reclaimed rubber. Currently, they sell their products to OEM’s, Tier I companies in the automotive manufacturing sector, distributors and dealers. The company also sell its products to foreign buyers located in Sri Lanka, Argentina, Turkey, China, etc through merchant exporters.

iv. At their manufacturing facility, theyr have an in-house testing laboratory, for testing their raw materials and finished products to match the quality standards as specified and required by the customers. The company strives to meet all the environment, health and safety standards in the manufacturing process. Every batch of Reclaimed rubber undergoes various parameters of quality tests.

Competitive Strengths

i. In-house manufacturing facility supported by technology driven process
ii. Diversified customer base and long-standing relationship with our customers
iii. Experienced Promoter Directors with extensive domain knowledged.

 

 

Objects of the Lead Reclaim and Rubber Products Limited IPO:

The Company proposes to utilize the Net Proceeds from the Issue towards the following objects: i. Funding the working capital requirements; ii. Purchase of plant and machinery for augmenting the Manufacturing Facility; and iii. General corporate purposes  
RHP of Lead Reclaim and Rubber Products Limited IPO

Lead Reclaim and Rubber Products Limited IPO Details:

Open Date: Feb 09 2023
Close Date: Feb 13 2023
Total Shares: 1,950,000
Face Value: ₹ 10 Per Equity Share
Issue Type: Fixed Price Issue IPO
Issue Size: 4.88 Cr.
Lot Size: 6000 Shares
Issue Price: ₹ 25 Per Equity Share
Listing At: NSE Emerge
Listing Date: Feb 21 2023

Promoters And Management:

i. Baldevbhai Patel, aged 61 years, is the Chairman and Non- Executive Director of the Company. He is one of the promoters of the Company. He has been associated with the Company since its incorporation as a Director and Promoter. He holds a bachelor of commerce degree from Gujarat University. He has over 10 years of experience in the field of rubber industry and also, he has experience of over 25 years salt industry. ii. Jayeshkumar Patel, aged 37 years, is the Managing Director of the Company. He is one of the promoters of the Company. He has been associated with the Company since its incorporation as a Director and Promoter. He has completed his professional graduation in diploma in business management from London School of Business and Computing, United Kingdom in 2010 and has experience of over 10 years with the Company. iii. Kalpesh Patel, aged 52 years, is the Whole-time director of the Company. He holds a bachelor of commerce from University of Bombay in 1991. He had previously associated in financial market over a period of 10 years. He has been on the board of the Company since January 2014 as a Director.  

Financials of Lead Reclaim and Rubber Products Limited IPO:

Particulars (In Lakh) 2022 2021 2020
Revenue from Operation 1,030 704 477
Cost of Material Consumed 621 351 221
Change In Inventories -26 10 -5
Employees Benefit Expenses 48 28 15
Other Expenses 271 197 138
EBITDA 116 118 108
OPM% 11.26% 16.76% 22.64%
Other Income 7 3 6
Depreciation 36 36 42
Finance Cost 21 32 29
PBT 66 53 43
Tax 18 29 7
PAT 48 24 36
No. Of Shares 73 73 73
EPS 0.65 0.32 0.49
 

Comparison With Peers:

Name of The Company Revenue (Cr) Profit (Cr) EPS P/E CMP MCap
Lead Reclaim & Rubber Product Limited 10 0.48 0.65 38 25 18
GRP Limited 388 6 43 40 3,120 415

Recommendation on Lead Reclaim and Rubber Products Limited IPO:

Review and Recommendation of Lead Reclaim and Rubber Products by IZ team is 4/10 (i) Lead Reclaim and Rubber Products Ltd is in the business of manufacturing of reclaimed rubber, crumb rubber powder and rubber granules. They claim to be one of the few recovered rubber firms that can process radial, scrap tyre, and tube rubber. (ii) The Company focus on :- a ) saving valuable natural resources by way of recycling. b ) helping our customers fulfil their circularity aspirations through use of our reclaimed rubber products. (iii) Their manufacturing facility is located in Gujarat, with a total land area of 7790 Sq. mts. The existing plant occupies 2253 Sq. mts with a total install capacity of 5520 metric tonnes. (iv) To ensure that there finished product meets customer specifications, their manufacturing plant uses a rigorous quality control system throughout the recycling process. (v) Their product portfolio includes various grades, thicknesses, widths, and standards of whole tyre, butyl, and natural reclaimed rubber. (vi) Currently, they sell their products to companies in the automotive manufacturing sector, distributors and dealers. They also sell their products to foreign buyers located in Sri Lanka, Argentina, Turkey, China, etc through merchant exporters. (vii) Their revenue from exports (including sales through merchant exporter) for the six months period ended September 30, 2022 and for the FY 2022 and FY 2021 has been Rs. 162.60 Lakhs, Rs. 522.39 Lakhs and Rs. 15.75 Lakhs, respectively which constituted 33.02%, 50.71% and 2.24% of their revenue from operations for the respective fiscal. (viii) The Revenue has Increased from Rs 4 Crore in FY20 to Rs 10 Crore in FY22. (ix) The EBITDA has Increased from 1.08 Crore in FY20 to 1.16 Crore in FY22. (x) The PAT has Increased from 36 Lakhs in FY20 to 47 Lakhs in FY22. (xi) As per FY22, EPS is 0.65, Market Capitalization is 18 Crore & P/E is 38.34x.

Lead Manager of Lead Reclaim and Rubber Products Limited IPO:

  1. Fedex Securities Limited

Registrar of Lead Reclaim and Rubber Products Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

Lead Reclaim and Rubber Products Limited A/8, Sunvilla Complex, Near Chines Hut Hotel, Dahej, Bypass Road, Bharuch-392001 Phone: +91 73590 10333 Email: info@leadrubber.com Website: http://www.leadreclaim.com/

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