Lead Reclaim and Rubber Products SME
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 09 Feb 2023 – 13 Feb 2023
- Listing date
- 21 Feb 2023
- Face value
- ₹10 per share
- Issue price
- ₹25 per share
- Lot size
- 6,000 shares
- Total issue size
- ₹4.88 Cr
- Market cap at offer price
- ₹18.35 Cr
- Promoter holding
- 86.48% → 63.51% pre-issue → post-issue
- ISIN
- INE0H4B01011
- Registrar
- Bigshare Services Pvt.Ltd.
- Lead managers
- Fedex Securities Pvt.Ltd.
- Registered office
- A/8, Sunvilla Complex, Near Chines Hut Hotel, Dahej, Bypass Road, 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 | 1,02,000 | — | — |
Application size
Minimum 6,000 shares per lot, in multiples, at ₹25
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 6,000 | ₹1,50,000 |
| S-HNI (min) | 2 | 12,000 | ₹3,00,000 |
| S-HNI (max) | 6 | 36,000 | ₹9,00,000 |
| B-HNI (min) | 7 | 42,000 | ₹10,50,000 |
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 |
|---|---|---|
| Market cap | — | ₹18.35 Cr |
Key performance indicators
- PAT margin
- 4.65%
- NAV per share
- ₹13.06
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Lead Reclaim and Rubber Products SME
Lead Reclaim and Rubber Products Limited (LRRPL) manufactures reclaimed rubber, crumb rubber powder and rubber granules. Originally incorporated as 'Lead Amber Microtech Limited' on October 31, 2012 under the Companies Act, 1956 (commencing business November 10, 2012), it was renamed 'Lead Reclaim and Rubber Products Limited' pursuant to a special resolution passed on December 28, 2013, with a fresh certificate of incorporation issued December 31, 2013 (CIN U25203GJ2012PLC072513). Its registered office is at A/8, Sunvilla Complex, Dahej Bypass Road, Bharuch, Gujarat. The company operates a single manufacturing facility at 856/4, Sarali Road, Village Pithai, Taluka Kathalal, Kheda, Gujarat, spread over ~7,790 sq. mts. (plant ~2,253 sq. mts.) with an approved installed capacity of 5,520 MT per annum, accredited with ISO 9001:2015. It recycles whole tyre scrap, natural rubber tube scrap, butyl tube scrap, nylon, radial and tubeless tyre scrap into whole tyre reclaim rubber sheets (fine, superfine, medium and high tensile grades), natural tube reclaim rubber, butyl tube reclaim rubber and crumb rubber powder, selling to automotive manufacturers, distributors and dealers in India and abroad (including Sri Lanka, Argentina, Turkey and China via merchant exporters). Exports (including deemed exports through merchant exporters) were Rs. 162.60 Lakhs (33.02% of revenue) for the six months ended September 30, 2022 and Rs. 522.39 Lakhs (50.71%) in FY2022. Revenue from operations grew from Rs. 477.31 Lakhs (FY2020) to Rs. 703.50 Lakhs (FY2021) and Rs. 1,030.09 Lakhs (FY2022), with profit after tax of Rs. 47.87 Lakhs in FY2022; the top ten customers contributed 94.20% of FY2022 revenues.
Company Analysis
from RHPLead Reclaim and Rubber Products Limited is a Gujarat-based manufacturer of reclaimed rubber, crumb rubber powder and rubber granules made from recycled scrap tyres and tubes, operating in the rubber recycling and rubber products industry.
Lead Reclaim and Rubber Products Limited (LRRPL) manufactures reclaimed rubber, crumb rubber powder and rubber granules. Originally incorporated as 'Lead Amber Microtech Limited' on October 31, 2012 under the Companies Act, 1956 (commencing business November 10, 2012), it was renamed 'Lead Reclaim and Rubber Products Limited' pursuant to a special resolution passed on December 28, 2013, with a fresh certificate of incorporation issued December 31, 2013 (CIN U25203GJ2012PLC072513). Its registered office is at A/8, Sunvilla Complex, Dahej Bypass Road, Bharuch, Gujarat. The company operates a single manufacturing facility at 856/4, Sarali Road, Village Pithai, Taluka Kathalal, Kheda, Gujarat, spread over ~7,790 sq. mts. (plant ~2,253 sq. mts.) with an approved installed capacity of 5,520 MT per annum, accredited with ISO 9001:2015. It recycles whole tyre scrap, natural rubber tube scrap, butyl tube scrap, nylon, radial and tubeless tyre scrap into whole tyre reclaim rubber sheets (fine, superfine, medium and high tensile grades), natural tube reclaim rubber, butyl tube reclaim rubber and crumb rubber powder, selling to automotive manufacturers, distributors and dealers in India and abroad (including Sri Lanka, Argentina, Turkey and China via merchant exporters). Exports (including deemed exports through merchant exporters) were Rs. 162.60 Lakhs (33.02% of revenue) for the six months ended September 30, 2022 and Rs. 522.39 Lakhs (50.71%) in FY2022. Revenue from operations grew from Rs. 477.31 Lakhs (FY2020) to Rs. 703.50 Lakhs (FY2021) and Rs. 1,030.09 Lakhs (FY2022), with profit after tax of Rs. 47.87 Lakhs in FY2022; the top ten customers contributed 94.20% of FY2022 revenues.
Objects of the Issue
- Funding our working capital requirements ₹101.43 Lakhs p.109
- Purchase of plant and machinery for augmenting our Manufacturing Facility ₹216.42 Lakhs p.114
- General corporate purposes ₹109.60 Lakhs p.116
Issue Structure
- Total Issue
- 19,50,000 Equity Shares aggregating ₹487.50 Lakhs (constituting 26.56% of post-issue paid-up capital)
- Fresh Issue
- 19,50,000 Equity Shares aggregating ₹487.50 Lakhs (100% Fresh Issue)
- Offer for Sale
- NA (no offer-for-sale component)
- Price Band
- Fixed Price Issue at ₹25 per Equity Share (including premium of ₹15 per Equity Share); Issue Price is 2.5 times the face value
- Lot Size
- 6,000 Equity Shares and in multiples thereof
- Face Value
- ₹10 per Equity Share
Business Model
The Company earns revenue from the sale of reclaimed rubber products — whole tyre reclaim rubber sheets in multiple grades, natural tube reclaim rubber sheets, butyl tube reclaim rubber sheets and crumb rubber powder — produced at its Kathalal (Kheda, Gujarat) facility from recycled scrap tyres and tubes, sold to domestic customers (automotive/rubber product manufacturers, distributors and dealers) and exported through merchant exporters.
Business Segments
SWOT Analysis
- • Technology-driven in-house manufacturing facility with 5,520 MT approved installed capacity(p.148)
- • Diversified customer base with long-standing relationships and export reach(p.148)
- • Experienced promoter directors with over 10 years in the rubber industry(p.148)
- • Locational advantage near ports and inland container depots(p.149)
- • Stringent multi-stage quality control mechanism ensuring standardized product quality(p.149)
- • One of the few companies able to process radial rubber, scrap tyre and tube rubber(p.146)
- • Consistent financial performance with growing revenue and profit(p.149)
- • High customer concentration — top 10 customers contribute 94.20% of revenues(p.37)
- • Negative cash flows from operating and investing activities(p.39)
- • Substantial indebtedness with restrictive covenants(p.40)
- • Registered office premises owned by promoter without formal agreement(p.38)
- • Company logo is not a registered trademark(p.39)
- • No long-term contracts with customers(p.44)
- • Expansion machinery orders yet to be placed (Rs. 216.42 lakhs)(p.41)
- • Fire hazard exposure across all stages of handling combustible rubber(p.37)
- • Increase capability to manufacture reclaimed rubber from radial and tubeless tyres(p.149)
- • Augment sales in domestic and international markets and expand into new geographies(p.149)
- • Continue to drive cost efficiency and economies of scale(p.150)
- • Operates in an industry where India is the world's largest reclaimed rubber manufacturer(p.133)
- • Proposed machinery purchase expected to improve margins via better yield(p.112)
- • IPO-funded working capital to expand operations and increase profitability(p.111)
- • Intense competition from organized and unorganized players(p.40)
- • Raw material price volatility and reliance on spot-market sourcing(p.41)
- • Rising energy costs (coal and electrical power)(p.41)
- • Dependence on overall Indian economic growth(p.47)
- • Rising inflationary pressures in India(p.47)
- • Adverse changes in the regulatory framework(p.49)
- • Emergence of global competition from other manufacturing countries(p.49)
- • Uncertain impact of the COVID-19 pandemic(p.50)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Jayeshkumar Patel | Promoter & Managing Director | 28.15% | 20.68% |
| Baldevbhai Patel | Promoter & Chairman (Non-Executive Director) | 26.42% | 19.40% |
| Sadhana Patel | Promoter | 14.85% | 10.90% |
| Kalpesh Patel | Promoter & Whole-Time Director | 10.81% | 7.94% |
| Rekhaben Patel | Promoter | 1.43% | 1.05% |
| Diksha Patel | Promoter | 0.43% | 0.32% |
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.