Aditya Ultra Steel
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 09 Sep 2024 – 11 Sep 2024
- Listing date
- 16 Sep 2024
- Face value
- ₹10 per share
- Issue price
- ₹62 per share
- Lot size
- 2,000 shares
- Issue type
- Book Building issue
- Listing at
- NSE
- Total issue size
- ₹45.88 Cr
- Market cap at offer price
- ₹154 Cr
- Promoter holding
- 97.94% → 68.76% pre-issue → post-issue
- ISIN
- INE01YQ01013
- Registrar
- Cameo Corporate Services Ltd.
- Lead managers
- Swastika Investmart Ltd.
- Registered office
- Survey No.888/807/810, FP-25, 28, T 808-C, Pinnacle, Prahlad Nagar Area, Opp.Royal Arcade, AUDA Garden, Gujarat
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Market maker | 3,70,000 | — | — |
Application size
Minimum 2,000 shares per lot, in multiples, at ₹62
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 2,000 | ₹1,24,000 |
| S-HNI (min) | 2 | 4,000 | ₹2,48,000 |
| S-HNI (max) | 8 | 16,000 | ₹9,92,000 |
| B-HNI (min) | 9 | 18,000 | ₹11,16,000 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Valuation and performance
Valuation at offer price
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 4.54 | 3.19 |
| P/E (×) | 13.66 | 19.44 |
| Price to book (×) | 2.83 | — |
| Market cap | — | ₹154 Cr |
Key performance indicators
- Return on net worth
- 21.08%
- ROCE
- 18.75%
- Debt / equity
- 1.44
- PAT margin
- 1.35%
- NAV per share
- ₹21.93
- Price to book
- 2.83
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Aditya Ultra Steel
Aditya Ultra Steel Limited is engaged in the business of manufacturing rolled steel products, specifically TMT bars under a retail license agreement with Kamdhenu brand. The company was incorporated as a private limited company on July 27, 2011, and converted to a public limited company on July 26, 2018. The company manufactures TMT bars from billets through a reheating furnace and rolling mill process, catering mainly to the construction industry and infrastructure development. With over 12 years of history in TMT bar manufacturing, the company designs and manufactures TMT bars on a B2B basis. The customer base is spread primarily across Gujarat and to certain customers in Madhya Pradesh, Punjab, Haryana, Rajasthan, Uttar Pradesh, and Maharashtra. The manufacturing plant is located in Wankaner, Rajkot, Gujarat, equipped with testing laboratories, workers' accommodation, canteen, and transport facilities. Revenue from operations for FY 2023-24, FY 2022-23, and FY 2021-22 were ₹58,780.08 lakhs, ₹53,044.78 lakhs, and ₹51,535.53 lakhs respectively.
Company Analysis
from RHPAditya Ultra Steel Limited manufactures TMT (Thermo-Mechanically Treated) steel bars under the Kamdhenu brand for construction and infrastructure sectors, operating primarily in Gujarat.
Aditya Ultra Steel Limited is engaged in the business of manufacturing rolled steel products, specifically TMT bars under a retail license agreement with Kamdhenu brand. The company was incorporated as a private limited company on July 27, 2011, and converted to a public limited company on July 26, 2018. The company manufactures TMT bars from billets through a reheating furnace and rolling mill process, catering mainly to the construction industry and infrastructure development. With over 12 years of history in TMT bar manufacturing, the company designs and manufactures TMT bars on a B2B basis. The customer base is spread primarily across Gujarat and to certain customers in Madhya Pradesh, Punjab, Haryana, Rajasthan, Uttar Pradesh, and Maharashtra. The manufacturing plant is located in Wankaner, Rajkot, Gujarat, equipped with testing laboratories, workers' accommodation, canteen, and transport facilities. Revenue from operations for FY 2023-24, FY 2022-23, and FY 2021-22 were ₹58,780.08 lakhs, ₹53,044.78 lakhs, and ₹51,535.53 lakhs respectively.
Objects of the Issue
- Capital Expenditure ₹1,535.00 lakhs p.23
- To meet Working Capital requirements ₹1,500.00 lakhs p.23
- General Corporate Purpose p.23
- Capital Expenditure for commissioning of Solar Power Plant ₹1,535.00 Lakhs p.84
- To Meet Working Capital Requirements ₹1,500.00 Lakhs p.85
- General Corporate Purposes [●] p.88
- Public Issue Related Expenses [●] p.89
- Not specified in this part of the document
Issue Structure
- Total Issue
- 74,00,000 Equity Shares aggregating up to ₹[●] Lakhs
- Fresh Issue
- 74,00,000 Equity Shares of face value of ₹10 each
- Offer for Sale
- Nil
- Price Band
- Floor Price ₹[●] and Cap Price ₹[●]
- Lot Size
- [●] equity shares and in multiples of [●] equity shares thereafter
- Face Value
- ₹10 per Equity Share
Business Model
The company manufactures TMT bars from billets through reheating furnace and rolling mill processes and sells them on a B2B basis primarily through Kamdhenu's distribution channel consisting of 1 distributor and 73 dealers in the Kutch and Saurashtra region of Gujarat.
Business Segments
SWOT Analysis
- • 12+ years of manufacturing experience in TMT bars industry with established brand presence(p.22)
- • Strong revenue growth trajectory with CAGR of approximately 40% from FY 2017-18 to FY 2023-24(p.37)
- • Established distribution network with 1 distributor and 73 dealers under Kamdhenu Brand in assigned region(p.29)
- • Manufacturing facility equipped with modern infrastructure including testing laboratories and good transport connectivity(p.22)
- • Strong revenue growth trajectory with CAGR of 26.16% from FY 2017-18 to FY 2023-24(p.109)
- • Experienced management team with 17+ years combined experience in steel industry(p.109)
- • Established brand presence and customer relationships in construction sector(p.109)
- • High return on net worth demonstrating operational efficiency(p.92)
- • Substantial installed production capacity for TMT bars(p.109)
- • Qualified and experienced management team with strong industry vision(p.110)
- • Skilled and dedicated workforce with strong operational efficiency(p.110)
- • Strategically located manufacturing plant with superior connectivity and infrastructure(p.110)
- • Strong existing customer relationships and high retention(p.110)
- • Harmonious labour relations with no strikes or protests(p.111)
- • Company-owned fleet providing operational flexibility and control(p.111)
- • Premium quality focus with strong brand reputation in retail segment(p.111)
- • High capacity utilization at 86%+ demonstrating operational efficiency(p.111)
- • High dependence on Kamdhenu brand with limited control over branding and marketing strategies(p.29)
- • Corporate guarantees given to group company VMS TMT Limited (₹6,960.76 Lakhs) exceeding company networth (₹3,758.21 Lakhs)(p.29)
- • Extreme customer concentration with top 1 customer representing 56.84% of sales in FY 2023-24(p.30)
- • High supplier concentration with top 10 suppliers contributing 70.91% of total purchases(p.30)
- • Significant working capital requirements with negative operating cash flows in FY 2021-22 (₹-618.20 Lakhs)(p.37)
- • Operating at only 86% of installed capacity; dependent on third-party manufacturer Maheshwar Ispat Private Limited for additional production(p.31)
- • Multiple instances of corporate secretarial non-compliance and statutory filing discrepancies with RoC(p.33)
- • Total debt of ₹5,427.07 Lakhs as on March 31, 2024 with contingent liabilities of ₹7,098.44 Lakhs(p.40)
- • High dependence on short-term borrowings relative to long-term debt structure(p.50)
- • Significant increase in trade receivables indicating potential collection challenges(p.50)
- • Large jump in other current liabilities which increased from ₹ 186.11 Lakhs to ₹ 1,199.88 Lakhs(p.50)
- • Company had discrepancies in corporate records and delayed filings with ROC(p.30)
- • Plant operational downtime affecting capacity utilization in recent period(p.95)
- • High dependence on working capital with capital-intensive business model(p.111)
- • Geographic concentration with 98.51% of sales from Gujarat(p.113)
- • Dependence on single brand - Kamdhenu - for market access(p.113)
- • Exposure to raw material price volatility without pricing control(p.111)
- • Reliance on third-party manufacturing capacity to meet demand(p.116)
- • Plant shutdown experienced for equipment upgrades impacting production(p.116)
- • High dependency on few customers(p.202)
- • High debt levels relative to equity(p.203)
- • Pending GST demand not recognized(p.175)
- • Pending Income Tax demand(p.175)
- • Ongoing NCLT litigation regarding deposits(p.206)
- • Directors faced CGST arrest and ongoing inquiry(p.207)
- • Significant concentration in single manufacturing location(p.193)
- • TMT bar market expected to grow at CAGR of 4.34% between 2022-2027, reaching USD 84.39 billion market size(p.22)
- • Expanding construction and infrastructure sector driving growth in India's steel market(p.22)
- • Geographic expansion opportunity beyond Kutch and Saurashtra regions within Gujarat and to other states(p.22)
- • Capital expenditure allocation of ₹1,535 Lakhs from IPO proceeds to enhance manufacturing capacity and modernization(p.23)
- • TMT bars recognized for superior properties (ductility, strength, weldability, corrosion resistance) with growing applications across grades Fe-415 to Fe-500D(p.22)
- • Government infrastructure spending initiatives driving steel demand in India(p.107)
- • Projected healthy steel demand growth in India at 8.6% in 2023 and 7.7% in 2024(p.107)
- • TMT bar market expected to grow at CAGR of 4.34% between 2022 and 2027(p.108)
- • Solar power plant investment to reduce operational costs and energy exposure(p.84)
- • Expansion of production capacity through external manufacturing partnerships(p.87)
- • Growing domestic TMT bars market driven by infrastructure demand(p.111)
- • Expansion of regional presence beyond Kutch and Saurashtra(p.110)
- • Capacity expansion to leverage increasing market demand(p.110)
- • Leverage established brand reputation for market penetration(p.119)
- • Increase wallet share and repeat business with existing customers(p.110)
- • Market consolidation opportunity against unorganized competitors(p.119)
- • Strong revenue growth trajectory(p.193)
- • Improving profitability and margins(p.194)
- • Expansion into trading segment(p.200)
- • Infrastructure and construction industry tailwinds(p.193)
- • 100% of revenue concentrated in Gujarat state with no alternate operational setup; vulnerability to regional slowdown(p.29)
- • Steel industry highly cyclical with volatile prices sensitive to macroeconomic factors and consumer confidence(p.31)
- • No long-term supply agreements for raw materials; dependent on purchase order basis creating supply chain risk(p.31)
- • Dependence on continuous electricity and water supply; risk of shortage affecting manufacturing operations(p.36)
- • Regulatory and licensing risks including need for government approvals and compliance with safety, health and environmental laws(p.38)
- • Interest rate fluctuations affecting cost of debt servicing and financial condition(p.45)
- • Global economic, political and social conditions beyond company control including inflation, deflation, and foreign exchange fluctuations(p.45)
- • Risk of natural disasters, civil disturbances and pandemics disrupting operations and economic growth(p.44)
- • Risk of NSE not granting approval for listing application(p.46)
- • Equity share price volatility and potential illiquid market post-listing(p.47)
- • Risk from promoter equity share sales potentially depressing share price(p.47)
- • Exposure to natural calamities affecting Indian economy and business(p.48)
- • Tax rate and slab changes by government affecting financial performance(p.46)
- • Availability of substitute materials competing with TMT steel bars(p.108)
- • Intense competition from unorganized players in the TMT industry(p.111)
- • Cyclical demand in construction sector affecting TMT bar sales(p.111)
- • Regulatory changes in environmental and labour compliance(p.111)
- • Economic uncertainty impacting construction activity and demand(p.111)
- • No entry barriers creating vulnerability to new competitors(p.111)
- • Shortage of skilled labour in manufacturing operations(p.111)
- • High capital intensity of business limiting growth flexibility(p.111)
- • Exposure to volatile raw material prices(p.200)
- • Exposure to fuel and coal price volatility(p.200)
- • Cyclicality and demand volatility in construction industry(p.200)
- • Competition from existing industry players(p.202)
- • Interest rate and finance cost risk(p.196)
- • Limited supplier diversification(p.202)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Sunny Sunil Singhi | Promoter | 35.27% | 24.76% |
| Varun Manojkumar Jain | Promoter | 23.65% | 16.61% |
| Varuna Jain | Promoter | 39.02% | 27.40% |
| Mr. Varun Manojkumar Jain | Promoter and Non-Executive Director | 23.65% | 16.61% |
| Mr. Sunny Sunil Singhi | Promoter and Chairman and Managing Director | 35.27% | 24.76% |
| Mrs. Varuna Jain | Promoter | 39.02% | 27.40% |
| Mr. Varun Manojkumar Jain | Promoter | 41,24,260 equity shares (23.65%) | — |
| Mr. Sunny Sunil Singhi | Promoter | 61,48,800 equity shares (35.27%) | — |
| Mrs. Varuna Jain | Promoter | — | — |
| Varun Manojkumar Jain | Promoter | 23.92% | — |
| Varuna Jain | Promoter | 39.48% | — |
| Sunny Sunil Singhi | Promoter | 35.68% | — |
Leadership
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.