Surani Steel Tubes Limited IPO

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(i) Surani Steel Tubes Limited is a name of excellence in the field of manufacturing and supplying best ERW pipes and Steel Tubes. The company commenced in July 2012 on the strong base formulated by decades of experience in this industry. The company is ISO 9001:2015 certified manufacturing and supplying of ERW pipes.

(ii) The company has a manufacturing plant at Dahegam, Gandhinagar, Gujarat spread across 8300 square meters of land having installed capacity of 25,000 MT Per Annum and it is currently running at 80% of the installed capacity.. The company has already purchased land of 32,019 square meters in Gandhinagar for the new manufacturing facility. The operation of which will start at the end of Dec 2018.

(iii) As on 31.03.2018, the company has more than 300 dealers in Gujarat.

(iv) ERW MS Pipes & Steel Tubes have turned the futuristic approach for ensuring smooth and advanced functioning of different industries. Be it agriculture, construction, chemicals or any other large scale industry, usage of these pipes is turning prominent. Understand this scenario in the industries of ERW MS pipes; Surani Steel has entered the marketplace with a clear vision of fabricating and supplying the best of it. Incepted in the year July 2012, the company distinguishes itself as leading and quality manufacturer of best steel tubes.

(v) The company is incepted and being managed by the experienced professionals, having decades of experience in ERW MS Pipes and steel tubes manufacturing. The deployment of best resources and state of art manufacturing facilities with the stronger back of technology is their forte.

(vi) Clients of the Company

Surani Steel Tubes Limited IPO Stock Quote & Charts

30.30

+0.33%

Check History
  • Open: 30.30
  • High - Low: 30.30 - 30.30
  • Previous Close: 30.20
  • Total Traded Volume: 2000
  • Updated On: 23-Dec-2019

Objects of the Surani Steel Tubes Limited IPO:

Objective of Surani Steel Tubes Limited IPO are: 1. Funding for the working capital requirement of the company= 9.2 Cr 2. General Corporate Expense.
DRHP of Surani Steel Tubes Limited IPO
RHP of Surani Steel Tubes Limited IPO

Surani Steel Tubes Limited IPO Details:

Open Date: Jan 25 2019
Close Date: Jan 29 2019
Total Shares: 2484000
Face Value: ₹ 10 Per Equity Share
Issue Size: 12.9168 Cr.
Lot Size: 2000 Shares
Issue Price: ₹ 52 Per Equity Share
Listing At: NSE Emerge
Listing Date: Feb 06 2019

Company Business:

Products of the Company 1.  Square & Rectangle Hollow Section They are engaged in manufacturing and supplying excellent quality Electric Resistance Welded Pipe. Owing to its high strength, perfect finish, corrosion resistance; the product is highly demanded in the market. Electric Resistance Welded Pipe are widely being used in Plumbing, Water Supply System, and Oil & Gas Transmission System. 2.  Round Pipes & Tubes They are one of the trusted manufacturers and suppliers of a wide range of MS Pipes. MS Pipes are widely being used in irrigation, oil, water & gas transmission system, sewage system and boilers. 3  MS Slit Coils & Strips These coils are extensively being used used in agriculture, constructional, medical and various other engineering industries. To meet the varied industrial demands, they offer these Mild Steel Coils in various standard and customized sizes & specifications. 4. Hot Roll Coils The Hot Rolled MS Coils are widely used in various heavy duty industries.

Financials of Surani Steel Tubes Limited IPO:

Year

Revenue(L)

PAT(L)

OPM

NPM

Equity(L)

EPS

Debt
FY14 3599 -2.99 3.72% -0.08% 25.00 -0.12 1040
FY15 5814 16.25 3.31% 0.28% 25.00 0.65 977
FY16 6845 109.6 5.00% 1.60% 25.00 4.38 1152
FY17 7670 99.9 4.60% 1.30% 25.00 4.00 1264
FY18 10079 172.44 4.17% 1.71% 58.00 2.97 1435
IZ Review 1.  The Company has shown excellent Revenue growth of 29.36% in the last 5 years. 2. The Company has shown excellent PAT growth of 119.75% in the last 4 years. 3. The EPS( post issue )would be 2.08, so P/E = 25( reasonable) 4. The D/E post issue would be 0.61( Manageable)

Comparison With Peers:

(All Figures in Cr)

Company

FV

Revenue

PAT

Mcap

EV

EPS

P/E

Adj. P/E

Ronw

Mcap/Rev
Surani Steel 10 100.79 1.7244 30 44.42 2.97 17.5 25.59 16.6% 0.30
Rama Steel 5 338 10.59 171 215 6.30 16.18 20.31 14.30% 0.51
Hi-Tech Pipes 10 823 14.56 200 365 14.13 13.45 24.60 13.82% 0.24
APL Apollo Tubes 10 4371 112 2821.497 3460 47.63 24.96 30.61 12.4% 0.65
Note: 1. For Calculation of all the data, the financials of FY17-18 is taken. 2. For calculation of P/E, the Current Market Price on 18.01.2019 is taken. 3. The Data is taken from Moneycontrol.

Recommendation on Surani Steel Tubes Limited IPO:

Review and Recommendation of Surani Steels IPO from IZ team is: 5/10 [ The company has shown excellent growth in the last 5 years. The D/E equity post issue is manageable. The Pricing is done similar to peers. The outlook of the Steel sector is good.]

Lead Manager of Surani Steel Tubes Limited IPO:

  1. Pantomath Capital Advisors Private Limited

Registrar of Surani Steel Tubes Limited IPO:

  1. Link Intime India Private Limited

Company Address:

Address: S.No 110,115 Opp Vinayak TMT, Bayad Road, Village Sampa, Ta.: Dahegam, Dist.: Gandhinagar Pin- 382315 (Gujarat) India

Bid Details of Surani Steel Tubes Limited IPO as on
29-Jan-2019 18:00:00 IST

Category No.of shares offered No. of shares bid
1,179,000 2,116,000
1,179,000 1,528,000
126,000 126,000
2,484,000 3,770,000
QIBs No
QIBs+HNIs Subscription 1.79X
Retail Subscription 1.30X
Total Subscription 1.55X

Discussion on Surani Steel Tubes Limited IPO:

11 Comments

    Good listing as expected earlier. The Shares list at Premium of 2.11%.

    Reply

    Pantomath is coming up with SME board IPO.

    *RITCO LOGISTICS Ltd.*

    Expected in last week of january.

    Issue size approx 48cr.

    Reply

    (i) The company has a Mcap of 57.38 Cr and a having sales of 100 Cr in FY18. So Mcap/Sales is 0.57( The stock is undervalued).

    (ii) The EBITDA Margins in the last 5 years are between 3 to 5%.

    (iii) Debt/Networth is 1.37( bit higher). Post issue Debt/Networth will be 0.61( manageable Debt/Networth).

    Reply

      Respected Market Wizard,
      Surani Steel is situated at Dehgam,
      It’s Considered an Ahmedabad MS Pipes Manufacturer.
      And Has Good Competition in and around Ahmedabad.
      Private and Unlisted Competition
      (1) Ahmedabad Strips Pvt Ltd (Pipe Division), Khatraj
      (2) Ocean Tubes , Vijapur
      (3) Milestone Tubes Pvt Ltd , Karai Roads, Gandhinagar
      (4) S K Tubes , Chhatral
      Listed Company Competition
      (1) Hi – Tech Pipes Ltd , Sanand Gidc
      (2) Riddhi Steel & Tube Ltd , Piplaj – Pirana Road
      (3) Asian Tubes Ltd
      (4) Asian Mills Ltd
      Now Market Wizard , go and check if the stock is undervalued or overvalued.

      Reply

    EPS calculation Pre issue based on FY18 Financials

    1. PAT= 172.44 lakh
    2. Outstanding Shares= 58 lakh
    3. EPS = 2.97
    4. P/E= 19.47

    EPS calculation Post issue based on FY18 Financials

    1. PAT= 172.44 lakh
    2. Outstanding Shares= 58 lakh + 24.84( New Shares in IPO)= 82.84 lakh
    3. EPS = 2.08
    4. P/E=25

    Reply

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