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Shree Tirupati Balajee Agro Trading IPO 💰💰
Full Details of Shree Tirupati Balajee Agro Trading IPO: - 👇
Shree Tirupati Balajee Agro Trading Company's initial public offering (IPO) is scheduled for September 5 to September 9, 2024, with a financial target of ₹169.65 crore.
This company specializes in the production of flexible intermediate bulk containers (FIBCs) and various other packaging solutions, and it reported that 64.13 percent of its revenue for the year 2023 was derived from international sales, catering to clients in more than 38 countries.
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| Shree Tirupati Balajee Agro Trading IPO |
Full Details of Shree Tirupati Balajee Agro Trading IPO: - 👇
- Shree Tirupati Balajee Agro Trading is set to launch its initial public offering (IPO), the second major IPO of September, with a target to raise ₹169.65 crore. The offering includes a fresh issuance of 1.48 crore shares valued at ₹122.43 crore, alongside an offer for sale of 0.57 crore shares, amounting to ₹47.23 crore, with promoter Binod Kumar Agarwal divesting a portion of his holdings.
- Retail investors interested in the IPO are required to place bids for a minimum of one lot, which consists of 180 shares, with the option to bid for a maximum of 13 lots. The minimum investment required is ₹14,940, while the maximum investment can reach ₹1,94,220.
- The allocation of the issue is structured such that at least 50 percent is designated for Qualified Institutional Buyers (QIBs), 35 percent is reserved for retail investors, and the remaining 15 percent is allocated to Non-Institutional Investors (NIIs).
Read RHP carefully before investing in Shree Tirupati Balajee Agro Trading IPO 📖
As the organization gears up for its public offering, prospective investors need to grasp the critical information presented in the Red Herring Prospectus (RHP), which offers significant insights into the company's financial status, growth plans, and competitive positioning in the market.
This article aims to distill the essential highlights from the RHP, providing the vital information necessary for making a well-informed decision regarding this initial public offering (IPO).
Company Profile: Shree Tirupati Balajee Agro Trading 📌
Shree Tirupati Balajee Agro is engaged in the production and distribution of Flexible Intermediate Bulk Containers (FIBCs), which are sizable flexible bags designed for various applications.
In addition to FIBCs, the company also produces a range of other industrial packaging solutions, including woven sacks, woven fabric, narrow fabric, and tapes. These products are marketed both within the Indian domestic market and internationally.
The organization provides tailored bulk packaging solutions to its clientele in a diverse array of sectors, such as chemicals, agrochemicals, food, mining, waste management, agriculture, lubricants, and edible oils.
These FIBC products are meticulously engineered to meet the specific requirements of transportation and packaging, capable of accommodating loads between 500 kg and 2,500 kg.
Shree Tirupati Balajee Agro boasts more than two decades of expertise and functions from five distinct manufacturing facilities.
The organization oversees its operations through several subsidiaries, including Honourable Packaging Private Limited (HPPL), Shree Tirupati Balajee FIBC Limited (STBFL), and Jagannath Plastics Private Limited (JPPL).
Purpose of the Issue (Shree Tirupati Balajee Agro Trading IPO) 🔎
The organization intends to allocate the net proceeds from the new issuance, which is calculated as the gross proceeds less any expenses related to the offering, to fulfill the following goals.
- Repayment and/or prepayment, either partially or fully, of specific outstanding loans incurred by the company and its subsidiaries, including Honorable Packaging Private Limited (HPPL), Shree Tirupati Balajee FIBC Ltd (STBFL), and Jagannath Plastics Pvt Ltd (JPPL).
- Providing financial support for the additional working capital needs of the company and its subsidiaries.
- Addressing various general corporate objectives.
- An allocation of ₹57 crore will be directed towards the repayment of debts.
An allocation of ₹57 crore is designated to settle outstanding debts. 💸
The organization intends to designate a maximum of ₹57 crore from the initial public offering (IPO) net proceeds for repaying or prepaying specific term loans and working capital facilities.
This allocation will address the financial obligations of the company and its subsidiaries, which include Honorable Packaging Private Limited (HPPL), Shree Tirupati Balajee FIBC Limited (STBFL), and Jagannath Plastics Private Limited (JPPL).
As of February 29, 2024, the total outstanding borrowings of the company, which include both fund-based and non-fund-based loans, amounted to ₹24,293.78 lakh on a consolidated basis.
Major Revenue from Exports 💸
The organization specializes in the export of Flexible Intermediate Bulk Containers (FIBC), which include a variety of products such as technical bags, container liners, food-grade bags, platen bags, and builder bags.
In recognition of its achievements, the company has been designated as a Three Star Export House by the Department of Commerce, Ministry of Commerce and Industry, in alignment with the Foreign Trade Policy of 2023 established by the Government of India.
The proportion of export sales represented 63.06 percent, 64.13 percent, 84.44 percent, and 67.73 percent of the total revenue for the periods concluding on September 30, 2023, as well as for Fiscal 2023, Fiscal 2022, and Fiscal 2021, respectively.
In the first half of the previous fiscal year, domestic sales contributed 36.94 percent to the company's overall revenue.
The organization distributes its products to more than 38 nations spanning six continents, with significant export markets comprising Australia, New Zealand, the United States, Canada, Chile, Sweden, France, the United Kingdom, Germany, Spain, Malaysia, and Singapore.
A significant share of the company's sales is derived from international clients, with the primary markets being the USA, Germany, Sweden, the UK, Spain, France, Australia, Canada, Lithuania, and Singapore.
For the fiscal year concluding on March 31, 2023, the organization reported that 64.13 percent of its net revenue was generated from operations across these nations.
Five locations in central India provide significant strategic benefits. 🌏
The organization has five production facilities situated in Pithampur and Indore, both of which are in Madhya Pradesh. Positioned centrally within India, these facilities benefit from excellent connectivity to key national highways, offering a significant advantage for distribution across the country.
The organization began manufacturing specialized polypropylene woven bags, fabric, belts, and tapes in 2002, starting with an initial production capacity of 1,440 metric tons per annum from Unit I.
By 2012, this capacity was significantly increased to 20,000 metric tons per annum. In 2006, the company expanded its operations to include the production and export of flexible intermediate bulk containers (FIBC).
Promoter Holding in Shree Tirupati Balajee Agro Trading 📶
The promoter possesses almost a 90% ownership interest in the company.
Binod Kumar Agarwal, a skilled chemical engineer and the promoter of the company, currently holds the position of managing director.
As detailed in the company's Draft Red Herring Prospectus (DRHP), he possesses 5,90,57,490 equity shares, accounting for 88.382 percent of the total issued, subscribed, and paid-up equity share capital before the offer.
Competitors of Shree Tirupati Balajee Agro Trading 📢
The organization finds itself in competition with both major, well-established corporations and smaller regional entities.
Within the landscape of publicly traded companies of similar size and product offerings in India, it contends with various private competitors, such as Kanpur Plastipack Ltd, Rishi Techtex Ltd, Jumbo Bag Ltd, EMMBI Industries Ltd, and Commercial Syn Bags Ltd.
Financial Details of Shree Tirupati Balajee Agro Trading 🚀📈
For the six-month period concluding on September 30, 2023, the company reported operational revenue of ₹200.77 crore, which encompasses earnings from both domestic and international sales of its manufactured goods.
In Fiscal 2023, the operational revenue experienced a growth of 7.04 percent, reaching ₹475.43 crore, compared to ₹444.18 crore in Fiscal 2022.
This growth was largely attributed to a significant 148.69 percent increase in domestic sales, fueled by enhanced sales of manufactured products and services.
The profit for the fiscal year 2023 increased by 51.36 percent, reaching ₹20.72 crore, in contrast to ₹13.69 crore recorded in the fiscal year 2022.
Key Risk in Company DRHP Report 📝
The company has identified several significant risks in its Draft Red Herring Prospectus (DRHP) report.
Regulatory Risks: The rising awareness and regulatory initiatives aimed at mitigating pollution have resulted in stricter limitations on plastic products.
Should any of its plastic packaging items face bans in India or in any of its international markets, the company's business operations and financial performance could be adversely affected.
Variability in Raw Material Costs: The main raw materials utilized by the company consist of polypropylene granules, low-density polyethylene (LDPE), and high-density polyethylene (HDPE) across different grades.
Given that these materials represent a significant share of the company's expenditures, changes in crude oil prices can have a direct impact on the costs associated with polymers.
Furthermore, the company may face challenges due to fluctuations in foreign exchange rates during polymer imports, as well as potential rises in raw material costs, supply shortages, and budget overruns, all of which could negatively impact its operations.
Anti-Dumping Duties: The organization indicated that it might encounter anti-dumping duties, which could adversely affect its financial situation.
Shree Tirupati Balajee Agro Trading IPO Allotment and Listing Details 📰
- The allocation for the Shree Tirupati Balajee Agro Trading Company IPO is anticipated to be completed on Wednesday, September 10, 2024.
- The shares are set to be listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
- The provisional listing date for the shares is September 12, 2024.
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