Vibhor Steel Tubes Ltd IPO - Review, Valuation, Date & GMP

Vibhor Steel Tubes IPO  - Complete Overview

Founded in 2003, Vibhor Steel Tubes Limited is a company in India that makes, exports, and supplies steel pipes and tubes to heavy engineering industries. 

Steel pipes and tubes from Vibhor Steel Tubes have various applications, including frames, shafts, bicycle frames, furniture, shockers, structural purposes, engineering purposes, and more. They offer a wide range of products in different shapes and sizes, meeting customer specifications.

They operate in Raigad, Maharashtra, and Mahabubnagar (Dist.), Telangana, with a warehouse in Hisar, Haryana. As of January 24, 2024, the company has 640 permanent employees. The "Vibhor" brand is expanding globally, focusing on customer feedback and marketing efforts.

Some of their products:

• ERW pipes for water transport, oil, gas, and other non-toxic supplies.

• Hot-dipped galvanised pipes for agriculture and infrastructure.

• Hollow section pipes in square and rectangular forms.

• Primer painted pipes.

• Crash barriers for railways, highways, and roads.

 

Vibhor Steel Tubes IPO Overview:

Vibhor Steel Tubes IPO date is slated to be open for subscription from February 13, 2024, to February , 2024. This BSE NSE IPO follows a Book Built Issue IPO.

Vibhor Steel Tubes IPO price is fixed at Rs.141 to 151 per share. 

The total issue size of this IPO amounts to Rs.72.17 CR. The company has reserved 50% for institutional investors, 15% for non-institutional investors, and 35% for retail investors. 

 

Vibhor Steel Tubes IPO timetable (Tentative):

Events	Date
IPO Opening Date	13 February 2024
IPO Closing Date	15 February 2024
IPO Allotment Date	16 February 2024
Refund initiation	19 February 2024
IPO Listing Date	20 February 2024

Vibhor Steel Tubes IPO Details:

IPO opening & closing date	13 February to 15 February 2024
Face value	Rs.10 per share
Issue Price	Rs.141 to 151  per share
Lot Size	99  Shares
Price of 1 lot	Rs.14,949
Total Issue Size	shares (aggregating up to Rs.72.17 Cr)
Fresh issue	shares (aggregating up to Rs.72.17 Cr)
Listing at	BSE NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

 

Vibhor Steel Tubes IPO Lot Details:

 

Application	Lot	Shares	Amount
Minimum Lot Investment (Retail)	1 lot	99	Rs.14,949
Maximum Lot Investment (Retail)	13 lot	1287	Rs.1,94,337
Minimum Lot Investment (HNI)	14 lot	1,386	Rs.2,09,286
Maximum Lot Investment (HNI)	66 lot	6,633	Rs.9,86,634

 

 

Vibhor Steel Tubes IPO Reservation

QIB Shares Offered	Maximum 50%
Retail Shares Offered	Minimum 35%
Other Shares Offered	Minimum 15%

 

 

Company Financial

In FY 23, the company experienced significant growth in its Financials compared to FY 22.

(Amount in Crore)

Period	Sep 30  FY 23	Mar 31  FY 23	Mar 31  FY 22
Total Assets	376.48	293.63	248.54
Total Revenue	531.24	1,114.38	818.48
PAT	8.52	21.07	11.33
Net worth	101.76	93.20	71.97
Total Borrowings	160.27	126.83	106.07

Revenue By Operations

Revenue from operations increased in FY 23 compared to the previous year.                                            

(Amount in Lakhs)

Particulars	Sep 30 FY 23	Mar 31  FY 23	Mar 31  FY 22
Revenue from operations	53,051.01	1,11,311.90	81,799.60
Other Income	73.23	125.92	48.46
Total Revenue	53,124.24	1,11,437.82	81,848.07

 

The Objective of the Issue

The company intends to use the net proceeds for the following objectives.

• Funding working capital requirements.

• Supporting general corporate purposes.

Promoters and Management of Vibhor Steel Tubes IPO

1. Mr. Vijay Kaushik.

2. Mr. Vibhor Kaushik.

3. Mrs. Vijay Laxmi Kaushik.

4. M/s. Vijay Kaushik HUF.

Pre-issue Promoter Shareholding	98.24%
Post-issue Promoter Shareholding

 

Vibhor Steel Tubes IPO Lead Managers

• Khambatta Securities Limited 
  
  

Peers of Vibhor Steel Tubes IPO

Among Vibhor Steel Tubes peers, Apl Apollo Tubes Ltd. has the highest P/E ratio, followed by others.

Name of the company	Face value (Rs. per share)	P/ E	EPS (Basic) (Rs.)
Vibhor Steel Tubes Limited	10	10.17	14.85
Apl Apollo Tubes Ltd.	2	64.88	23.15
Hi-tech Pipes Limited	1	47.91	3.06
Goodluck India Ltd	2	31.01	33.31
Rama Steel Tubes Ltd	1	37.75	1.22

 

 

Evaluation

The IPO is priced within the range of Rs. 141 to Rs. 151 per share.

 

Evaluation of P/E Ratio:

- Considering the FY23 EPS of Rs 14.85 from the last year, the resulting P/E ratio is 10.17x.

- Taking into account the weighted EPS of Rs 10.17 for the last three years, the P/E ratio amounts to 14.84x.

    

Comparative Analysis with Listed Peers:

- Apl-Apollo Tubes Ltd. has a P/E ratio of 64.88x (the highest).

- Goodluck India Ltd has a P/E ratio of 31.01x (the lowest).

- The industry's average P/E is 45.39x.

As a result, the IPO price range, with a P/E ratio ranging from 10.17x to 14.84, seems undervalued in comparison to the industry average of 45.39x.

 

Dividend Policy

The company hasn't paid dividends in past fiscal years. Whether we can pay them in the future depends on factors like profits, past dividend trends, capital needs, legal restrictions, and other relevant considerations evaluated by our Board.

 

IPO's Strengths

• Healthy expansion plans in the oil & gas pipeline infrastructure.

• Government focuses on infrastructure development.

• Increase in budgetary allocation towards infrastructure, railways, etc.

• Government initiatives like 'One nation, One gas grid,' 'Jal Jeeven mission,' and 'Pradhan Mantri Awas Yojana.'

• Strong demand from end-user segments including real estate, water infrastructure, automobiles, railways, and capital goods.

 

IPO's Weaknesses

• High logistic costs.

• Potential impact of recession fears and weak global demand on export growth.

• Growing environmental concerns regarding carbon emissions from the steel industry.

• Volatility in steel prices, posing a potential threat to business profitability.

• Persistent inflation, leading to reduced demand for products and potential delays in project execution.

IPO GMP Today

The latest GMP of Vibhor Steel Tubes IPO is Rs. 140.

 

 

 

Conclusion

In conclusion, Vibhor Steel Tubes Limited presents itself as a promising player in the steel pipes and tubes industry, with a diverse product portfolio catering to various sectors like infrastructure, agriculture, and engineering. The IPO, scheduled to open from February 13 to February 15, 2024, comes at a price range of Rs. 141 to Rs. 151 per share, with a total issue size of Rs. 72.17 crore. However, potential weaknesses such as high logistic costs, global economic uncertainties, and environmental concerns in the steel industry should be carefully monitored. Investors should assess the risks associated with volatility in steel prices and inflation impact on demand.

As with any investment decision, prospective investors are encouraged to conduct thorough due diligence, evaluate their risk tolerance, and seek professional financial advice if needed. 

 

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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