### The Offer
- *Type*: Fresh Issue
- *Fresh Issue Size*: Up to ₹1,710.00 million
- *Offer for Sale Size*: Not applicable
- *Total Issue Size*: Up to ₹1,710.00 million
- *Price Band*: 195 to 207
- *Bidding Period*: June 26, 2024, to June 28, 2024
- *Listing*: BSE and NSE
### Shareholding Pattern
The promoters of the company are Vijay Anand Jhanwar, Kusum Lata Maheshwari, Gopal Sponge and Power Private Limited, V.A. Transport Private Limited, Kirti Ispat Private Limited, Bhinaswar Commercial Private Limited, and Utkal Ispat Private Limited.
### Object of the Offer
The proceeds from the issue will be utilised for:
1. Expansion of the Bilaspur Plant.
2. General corporate purposes.
3. Repayment or prepayment of certain borrowings.
### About the Company
Vraj Iron and Steel Limited, initially incorporated as Phil Ispat Private Limited in 2004, is involved in manufacturing and selling iron and steel products. The company has undergone several name changes and is currently headquartered in Raipur, Chhattisgarh.
### About Industry and Growth Prospectus
The iron and steel industry indicates robust demand due to infrastructure development and increased consumption in various sectors.
### Peer Group of Companies and their KPIs
The peer group comparison includes companies like Tata Steel, JSW Steel, and SAIL. Here TataSteel is the largest revenue making company while JSW steel is the company with largest Capacity and profitability. Majority of the companies from these sectors need high capex which makes a huge debt burden resulting in lesser consistency in Profits. Hence investing in this sector should have lesser weightage despite good growth. Majority of the Key performance indicators (KPIs) for these companies typically would be less favourable like profitability, debt levels, and return ratios.
### Financial Information
Here are key financial ratios and metrics based on the restated consolidated financial information:
#### Revenue and Growth
- *Revenue from Operations*: ₹5,156.71 million for the year ended March 31, 2023, up from ₹4,140.43 million in the previous year.
- *Profit After Tax*: ₹539.97 million for the year ended March 31, 2023, up from ₹287.04 million in the previous year.
#### Profit and Growth
- *EBIT*: ₹748.72 million for the year ended March 31, 2023.
- *Net Profit Margin*: Improved significantly over the past years.
Overall we can see good revenue growth during the past few years and the company is having better consistency in Profits.
#### Debt and Debt to Equity
- *Total Debt*: ₹49.3 Cr as of December 31, 2023.
- *Debt to Equity Ratio*: Total Debt of 49.3 Cr on the Total equity of 188 Cr suggests 0.26, we can say it is comfortable.
#### Price to Earnings (PE) Ratio
- *PE Ratio*: At the offered price of 207 we can say PE is 207/21.84 = 9.5 which is comfortable.
### Conclusion:
Yes we may see 20-25% opening in this IPO and the company seems to be good, but for long term the best choice could be JSWSteel which has high consistency in Profits and having the largest production capacity to cash the upcoming steel demand in India.
Disclosure: Do not invest blindly in any company, we are not the tip provider, analyse the data and take your decision for buy and sell.
