Mangalam Alloys Limited IPO - Review, Valuation & GMP Today

Mangalam Alloys Limited - Complete Overview

Established in 1988, Mangalam Alloys Limited is a stainless steel manufacturing company. The company specializes in the production of SS Ingots, Round Bars, RCS, Bright Bars, and various sections/profiles including squares, hexagons, angles, and pattis.

With approximately 200 employees, the company has earned several certifications, including ISO 9001:2015 and PED certificates, and has been recognized as a Two Star Export House by DGFT, India.

Mangalam Alloys Limited manufactures stainless steel ingots using three furnaces for melting stainless steel scrap. The process includes rolling ingots into stainless steel rounds and flats, followed by heat treatment in an annealing furnace and a bright bar unit.

The company operates an integrated stainless steel manufacturing facility that spans 40,000 square meters of land and boasts an installed capacity of 25,000 TPA for melting. In the financial year ending on March 31, 2023, the company achieved a turnover of Rs. 30,292.25 Lakhs.

 

What does the company do? 

Mangalam Alloys Limited is a manufacturer specializing in stainless steel products.

 

Company Products

Ingots, Black Round Bars, RCS, Bright Forged Round Bars, Bright Round Bars, Hexagonal & Square Bars, Angle Bars, Flat Bars, Hex Screw/Het Bolt, Hex Nut/Heavy Hex Nut, Allen Cap, Allen CSK, Stud/Threaded (Half/Full Threaded, Double Ended), Square Head Bolts / Screw, etc.

 

IPO Overview

Mangalam Alloys Limited IPO date is set to open on September 21, 2023, with the closing date being September 25, 2023. The company aims to raise Rs. 54.91 Crores through this SME IPO.

The Mangalam Alloys Limited IPO price is set at Rs. 80 per share. This IPO is categorized as a fixed-price issue, and the registrar for it is Skyline Financial Services Private Ltd.

For comprehensive information regarding the upcoming IPO, please refer to the Finowings IPO section.

 

Mangalam Alloys Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	21 September 2023
IPO Closing Date	25 September 2023
IPO Allotment Date	29 September 2023
Refund initiation	3 October 2023
IPO Listing Date	5 October 2023

 

Mangalam Alloys Limited IPO Details 

IPO Opening & Closing Date	21 September to 25 September 2023
Face value	Rs.10 per Share
Issue Price	Rs. 80 per Share
Lot Size	1600 Shares
Price of 1 lot	Rs.128,000
Issue Size	6,864,000 Shares (aggregating up to Rs. 54.91 Cr)
Offer for sale	737,600 Shares of Rs.10 (aggregating up to Rs. 5.90 Cr)
Fresh issue	6,126,400 Shares (aggregating up to Rs. 49.01 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Skyline Financial Services Private Ltd

 

Mangalam Alloys Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
Minimum Lot Investment (HNI)	2 Lot

 

Mangalam Alloys Limited IPO Reservation

Other Investors Share Portion	50%
Retail Investors Share Portion	50%

 

Company Financial

Amount in Lakhs

Period	FY - 21	FY - 22	FY - 23
Total Assets	31210.81	30066.96	33201.81
Total Revenue	27190.68	30973.94	30817.92
PAT	-653.69	505.08	1013.52
Net Worth	6390.37	6895.35	7903.11
Reserve & Surplus	4534.42	5039.40	6047.16
Total Borrowings	16769.66	16361.81	15353.27

 

State-wise Revenue of the Company

(Amount in Lakhs)

State	Revenue for FY 23
Gujarat	1,830.40
Karnataka	410.25
Maharastra	43.44
Punjab	6.72
Tamilnadu	5.98
Delhi	3.29
Uttar Pradesh	1.03
Haryana	0.48
Export	703.68
Total	3005.28

 

Revenue Generated From Top 10 Customers

(Amount in Lakhs)

Customers	Revenue for FY 23
Down Town Impex Private Limited	6,468.00
Mangalam Multi Businesses Private Limited	1,685.00
Arinox Comercial LTDA	1,436.00
Dharmik Steel	1,205.00
Artema Srl	1,045.00
Lalit Steel Industries	769.00
Maxim Tubes Company Private Limited	677.00
J H Manufacturing Co	499.00
Umit Paslanmaz Celik Mamulleri Imalat Sanayi Tic Limited	428.00
Hwangkum Steel and Technology Co. Limited	330.00
Total	14,542.00

 

Objective of the Issue

The raised funds will be allocated for the following purposes:

• Fulfilling working capital needs.
• Supporting capital expenditure for business expansion and research and development.
• Covering general corporate expenses.
• Meeting the expenses related to the issue.

 

Promoters and Management of Mangalam Alloys Limited

Mr. Uttamchand Chandanmal Mehta, Mr. Tushar Uttamchand Mehta and Meghjyoti Impex Private Limited are the promoters of the company.

Pre-issue Promoter Shareholding	81.17%
Post-issue Promoter Shareholding	59.74%

 

Peer Comparison

The following are the listed peers of the company, as per its DRHP. 

Company Name	EPS (Diluted)	P/E Ratio	CMP
Mangalam Alloys Limited	5.46	14.65	80
Ratnamani Metal & Tubes Lt	72.8	31.6	2,300
Arfin India Ltd	0.7	48.9	32
Panchmahal Steel Ltd	0.7	180.6	130
India Steel Works Limited	(1.5)	(1.2)	2

 

IPO's Valuations

To assess the IPO valuation, we can utilize the information provided by the company in its DRHP. With Mangalam Alloys Limited IPO price is Rs. 80 per share and having an EPS of Rs. 5.46, based on the issue price, the company's PE ratio, stands at approximately 14.65.

 

Dividend Policy 

The company has not distributed any dividends in past, and any future dividend payments will be contingent upon the financial performance of the company.

 

IPO's Strengths 

• Seasoned promoters, experience management, and a skilled workforce.
• Embracing a Zero Waste Philosophy and qualifying for MAKE IN INDIA.
• A robustly established distribution and marketing network.
• An integrated manufacturing facility with a strong focus on Quality Assurance and Control.

 

IPO Weaknesses

• The Company relies on its top 10 customers for a significant portion of its sales.
• A substantial part of the Company's total revenue is generated from just the top 2 states.
• The Company is subject to strict health and safety regulations.
• The industry segments in which the company operates faced intense competition.
• The company's lenders have imposed specific restrictive conditions as part of its financing arrangements.
• Some lenders who provided secured loans to the company have not granted a "No Objection Certificate."
• The company requires various statutory and regulatory approvals, registrations, and licenses for its operations.
• In the past, the Company experienced delays in making EPF payments and filing GST returns. 

 

IPO GMP Today

The Latest GMP of Mangalam Alloys SME IPO GMP is Rs. 5.

 

Conclusion

Mangalam Alloys Limited functions within a competitive market. Although the company possesses a strong distribution and marketing network, the abrupt increase in its earnings during FY23 has raised certain apprehensions. Knowledgeable investors may consider investing in the issue after conducting a comprehensive analysis. 

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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