Ratnaveer Precision Engineering IPO Review: Ratnaveer Precision Engineering is coming up with its Initial Public Offering. The IPO will unshut for subscription on September 4th, 2023, and tropical on September 6th, 2023.

In this article, we will squint at Ratnaveer Precision Engineering IPO Review 2023 and unriddle its strengths, weaknesses, GMP and more. Keep reading to find out!

Ratnaveer Precision Engineering IPO – About The Company

Ratnaveer Precision Engineering Limited, incorporated in 2002, produces stainless steel finished sheets, washers, solar roofing hooks, pipes, and tubes.

The visitor produces stainless steel-based products for the automotive, solar power, wind energy, power plants, oil and gas, pharmaceuticals, sanitary and plumbing, instrumentation, electromechanics, architecture, towers & construction, electrical appliances, transportation, kitchen appliances, chimney liners, and other industries.

Ratnaveer Precision Engineering has four production plants, two of which are located at GIDC, Savli, Vadodara, Gujarat, Unit-III at Waghodia, Vadodara, Gujarat, and Unit-IV at GIDC, Vatva, Ahmedabad, Gujarat.

As of FY23. the visitor has 2,500 SKUs of washers and intends to expand its portfolio of SS washers by subtracting circlips to the product line. During this time period, it has generated 80,79% domestically and 19.21% from its exports

Ratnaveer Precision Engineering IPO Review – Industry Overview

Because of its diverse range of uses, India is one of the fastest-growing stainless steel markets. Because of its largest endurance and lesser maintenance, stainless steel is used in infrastructure projects, manufacturing industries, and the manufacture of high-quality products.

According to Crisil Ratings, domestic stainless steel demand will expand at a CAGR of 9% till FY25. In FY22, this demand stood at 4 MT.

Stainless steel demand is expected to rise due to greater use in railways, as well as increased using in the automobile and construction industries.

Railway demand is expected to increasingly than triple by fiscal 2025, written for 20% of the metal’s spare demand between fiscal 2023 and fiscal 2025.

Other major stainless steel industries, such as consumer goods and the process industry, are expected to grow at a respectable rate of 7-9% over the next 3-5 fiscal years, thanks to increased consumer expenditure and a recovery in consumption.

Ratnaveer Precision Engineering IPO Review – Financials

If we squint at the financials of Vishnu Prakash R Punglia IPO Review we find out that their resources have moderately increased from ₹255.92 crores in March 2021 to ₹389.05 crores in March 2023.

Their revenues follow a similar trend, increasing from ₹364.05 crores in March 2021 to ₹481.14 crores in March 2023. The rise in revenues is accompanied by increasing profits, which have increased five times from ₹5.46 crores in March 2021 to ₹25.04 crores in March 2023.

Since the visitor operates in a high-cost industry, its margins will be restrictedly low. But over the past three years, it has increased its net profit margins from 1.50% to 5.21%. This can be partly attributed to the company’s focus on wrong-side-up integration.

In terms of return ratios, it has a ROE of 29.12% and a RoCE of 12.62% as of FY23. This suggests a good return on shareholders’ capital. But, at the same time, a lower RoCE than the ROE can suggest that the visitor has upper debts.

The debt-to-equity ratio of 2.17 remoter clarifies the whilom statement of the visitor having upper debt. The upper debt of the visitor is due to the upper mazuma spritz requirements of the visitor to run its operations. Apart from paying when the wanted borrowed, the visitor has an spare undersong of paying the interest on it, which in turn reduces the overall net profits.

Financial Metrics

Peers of the Company

The pursuit image will show you the peers of the visitor withal with their important metrics:

Additionally, the visitor operates in a highly fragmented and competitive industry d we compete with a range of organized and unorganized players, both at the national and regional level.

Strengths of the Company

• The visitor has ripened a system of wrong-side-up integration wherein, it processes the waste generated from manufacturing and converts it when to raw material used in manufacturing. The raw materials generated through wrong-side-up integration and raw materials uninventive from external resources are as follows:

• The visitor has a wide diversified product portfolio which enables it to meet the trends and waffly demands of its customers. It moreover gives it an whet to efficiently compete with our competitors.
• The visitor has a diverse consumer wiring in domestic as well as international markets. In the domestic market, it sells its products to manufacturers, traders and end users. In the international markets, it supplies its products to traders.
• The visitor has an in-house R7D facility wherein it develops tools and molds for its products which helps it enhance its product offerings.
• The visitor has ripened quality tenancy processes for inspecting the raw materials as well as the final products that ensure the production of quality products that help it enhance its trademark value.

Weaknesses of the Company

• The visitor does not have any long-term agreements with its raw material suppliers. An inability to procure the desired raw materials in a timely manner and at a reasonable cost, or at all, can have a negative impact on its business.
• Steel pricing is unauthentic by market demand, volatility, and economic factors. Steel price fluctuations may have an wrongheaded impact on the company.
• A majority portion of the total revenue is attained from the top 10 customers of the company. Additionally, the visitor does not enter into any long-term contracts with its customers and any failure to protract the existing arrangements could adversely stupefy its business.
• The visitor requires huge working wanted requirements to run its operations. The inability to meet the mazuma spritz requirements can have a negative impact on its operations
• The visitor operates in a highly competitive and fragmented industry with low barriers to entry and may be unable to compete successfully versus existing or new competitors from the organized and unorganized.

Ratnaveer Precision Engineering IPO Review – GMP

The shares of Ratnaveer Precision Engineering traded at a premium of 38.78% in the grey market on August 30, 2023. The shares tarded at Rs.136. This gives it a premium of Rs 38 per share over the cap price of Rs 98.

Ratnaveer Precision Engineering IPO – Key IPO Information

Promoters: Vijay Ramanlal Sanghavi

Book Running Lead Manager: Unistone Wanted Private Limited

Registrar to the Offer: Link Intime India Private Limited

The Objective of the Issue

The net proceeds from this issue will be utilized for the pursuit purposes:

• Financing the company’s working wanted requirements.
• General corporate purposes.

In Closing

In this article, we looked at the details of Ratnaveer Precision Engineering IPO Review 2023. We have to note that the visitor operates in a low-profit margin industry with many competitors. If the visitor manages to increase its volumes and focus increasingly on wrong-side-up integration, it has a good potential for the future.

What do think the future holds for the company? Are you applying for the IPO? Let us know in the comments below.

Written By Aaron Vas

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