Vruddhi Engineering Works IPO: Review, Valuation, Date & GMP

Vruddhi Engineering Works Limited IPO  - Complete Overview

Established in 2020, Vruddhi Engineering Works Limited specializes in providing mechanical splicing solutions to the real estate, construction, and infrastructure sectors through the design, engineering, and supply of rebar couplers. 

Within this vertical, the company offers customized rebar couplers, on-site threading services, and trades in threading machines and spares. 

Its clientele includes construction contractors, real estate developers, and infrastructure firms. 

As of March 31, 2023, the company has served approximately 84 customers in the mechanical splicing vertical and supplied to over 2 customers in steel product trading, generating revenue of 1,309.62 lakhs.

Vruddhi Engineering Works Limited IPO Overview

Vruddhi Engineering Works Limited IPO date is slated to be open for subscription from March 21, 2024, to March 26, 2024. This BSE SME IPO follows a Book Built Issue IPO.

Vruddhi Engineering Works Limited IPO price is set in the range of at Rs.66 to Rs.70 per share. 

The total issue size of this IPO amounts to Rs.4.76 Cr. The company has allocated 35% to retail investors, 50% to institutional and 15% to non instituional investors.

 

Company Financial

Compared to previous finacial years, Vruddhi Engineering Works Limited has seen growth in total assets, net worth, and total revenue. The profit after tax and total borrowings has also increased.

(Amount in Lakhs)

Period	31 Mar 2023	31 Mar 2022	31 Mar 2021
Total Assets	782.33	100.14	3.02
Total Revenue	1,309.62	220.65	0.44
PAT	75.33	9.44	-0.88
Net worth	212.12	9.56	0.12
Reserve & Surplus	118.55	8.56	-0.88
Total Borrowings	323.37	47.49	2.22

 

 

Product wise Revenue Break up

(Amount in Lakhs)

Products	FY 23	FY 22	FY 21
Rebar Couplers	450.28	105.83	0.44
Threading	130.90	23.92	-
PVC Cap	5.74	3.74	-
BTS Machine	54.31	6.84	-
Bars	629.13	54.81	-
Thread Rollers	12.34	1.00	-
Spare Parts	9.33	19.03	-
Mobile Ide Charges	8.73	5.14	-
Machine Mobilisation Charges	0.15	0.42	-
Machine Service Charges	4.59	-	-
Mobile Van Service Charges	1.69	-	-
Other Charges	1.91	0.53	-
Interest on Delayed Payment	-	0.24	-
Total	1,309.33	221.52	0.44
Less: adjustments (credit note, discount, etc)	1.86	0.87	-
Revenue from Operations	1,307.69	220.65	0.44

Industry-wise Revenue Breakup

(Amount in lakhs)

Products	FY 23	FY 22	FY 21
Construction / Project	0.00	0.00	0.00
Real Estate	1,299.55	220.65	0.44
Infrastructure	8.14	0.00	0.00
Total	1307.69	220.65	0.44

 

Geography-wise Revenue Breakup

(Amount in lakhs)

Products	FY 23	FY 22	FY 21
Mumbai	1081.08	175.28	0.44
Rest of Maharashtra	49.00	28.66	0.00
Other States	177.61	16.71	0.00
Total	1307.69	220.65	0.44

 

 

 

The Objective of the Issue

The company is intended to use the net proceeds to fulfil the following objectives:

1. To meet working capital requirements.

2. General Corporate Purpose  

 

Peers of Vruddhi Engineering Works Limited IPO

Name of the Company	Face Value (Rs)	EPS (Rs)	P/E Ratio
Vruddhi Engineering Works Limited	10.00	242.66*	-
Shiv Aum Steels Limited	10.00	10.53	28.49
SRU Steels Limited	10.00	0.87	24.89

*Without giving effect to bonus issue of Equity Shares

Evaluation

The IPO is priced within the range of Rs.66 to Rs.70 per share.

Evaluation of P/E Ratio

• Considering the FY23 EPS of Rs 4.09 from the last year, the resulting P/E ratio is 17.13x.

• Taking into account the weighted EPS of Rs 9.46 for the last three years, the P/E ratio amounts to 7.39x.

Comparative Analysis with Listed Peers

• The industry's average P/E is 26.69x.

As a result, the IPO price range, with a P/E ratio ranging from 17.13x to 7.39x, seems fully priced to the industry average of 26.69x.

 

 

 

IPO's Strengths 

• Varied customer base.

• Established and diversified product range.

• Emphasis on quality assurance.

• Promoter directors with extensive domain expertise and experience.

 

IPO weaknesses 

• The Company, along with its Promoters, Directors, and Group Companies, are involved in certain legal proceedings.

• The company is required to acquire, renew, or uphold statutory and regulatory licenses, permits, and approvals.

• Trading activities of the company are susceptible to price fluctuations of traded products.

• The company has experienced losses in previous fiscal years.

• A significant portion of the company's revenue is reliant on a few customers.

 

IPO GMP Today 

The latest GMP of Vruddhi Engineering Works Limited has not yet started.

Vruddhi Engineering Works Limited IPO timetable (Tentative)

Vruddhi Engineering Works Limited IPO is scheduled from March 21 to March 26, 2024, with allotment on March 27, refund initiation on March 28, and listing on April 1, 2024.

Events	Date
IPO Opening Date	March 21, 2024
IPO Closing Date	March 26, 2024
IPO Allotment Date	March 27, 2024
Refund initiation	March 28, 2024
IPO Listing Date	April 1, 2024

 

Vruddhi Engineering Works Limited IPO Details 

Vruddhi Engineering Works Limited IPO, with a face value of Rs.10 per share, opens on March 21 and closes on March 26, 2024, offering 680,000 shares at Rs.66 to Rs. 70 per share, with a lot size of 2000 shares, aiming to raise Rs.4.76 Cr, and will be listed on BSE SME.

IPO opening & closing date	March 21, 2024 to March 26, 2024
Face value	₹10 per share
Issue Price	₹66 to ₹70 per share
Lot Size	2000 Shares
Price of 1 lot	₹140,000
Issue Size	680,000 shares (aggregating up to ₹4.76 Cr)
Fresh issue	680,000 shares (aggregating up to ₹4.76 Cr)
Listing at	BSE SME
Issue Type	Book Built Issue IPO
Registrar	Bigshare Services Pvt Ltd

 

Vruddhi Engineering Works Limited IPO Lot Details 

For Vruddhi Engineering Works Limited IPO, the retail investor minimum and maximum lot investments are both 1 lot (2000 shares) at Rs.140,000 while for HNI investors, the minimum investment is 2 lots (4000 shares) at Rs.280,000.

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

 

 

Vruddhi Engineering Works Limited IPO Reservation

Institutional share Portion	50%
Non-institutional share Portion	15%
Retail share Portion	35%

 

Promoters and Management of Vruddhi Engineering Works Limited

• Ms. Bindi Kunal Mehta

Pre-issue Promoter shareholding	96.34%
Post-issue Promoter shareholding

 

Vruddhi Engineering Works Limited IPO Lead Managers

• Fedex Securities Pvt Ltd 

 

Dividend Policy

The Company has not declared or paid any dividend on the Equity Shares in the past finacial years and any future payment of dividend depends on the overall performance of the company.

 

 

Conclusion

Vruddhi Engineering Works Limited offers an exciting opportunity to investors to invest in its upcoming IPO. The company is showing strong growth in its financials. Seasoned investors may apply for the IPO after evaluating all the factors for optimal results.

 

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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