Hariom Pipe Industries has a strong distribution network. The company also has an integrated plan and a strong team of promoters. The issue price is also reasonable as compared to Pierce.
Hariom Pipe IPO Open Today: The Initial Public Offering (IPO) of Hyderabad-based Hariom Pipe Industries has opened for subscription from today. This IPO will be open for investment from 30 March to 5 April. The company has fixed the price band for the issue at Rs 144-153 per share. Whereas through this the company plans to raise Rs 130 crore. Recently, after a long correction, the market is once again seeing a recovery. In such a situation, should investors subscribe to this IPO? Ayush Agarwal, Senior Analyst, Swastika Investmart Ltd, says that only those investors should bet in these, who are aggressive and have a long-term outlook.
Valuation and View
Ayush Aggarwal says that the distribution network of Hariom Pipe Industries is strong. The company also has a strong brand recall, integrated plan and a strong team of promoters. Between 31 March 2019 to 31 March 2021, the company’s revenue has increased from Rs 133.59 crore to Rs 254.13 crore. The company’s PAT has increased from 8.02 crores to 15.13 crores during the same period. The issue price also looks reasonable as compared to the listed peers. The fundamentals of the company are strong and the product portfolio is also good. The company can give strong competition in its sector. Although there is volatility in the operating cash flow, the debt equity ratio is high and the issue size is very small. For this reason, only aggressive investors are advised to subscribe in this.
About the IPO
There will be a fresh issue of 85 lakh shares in the IPO of Hariom Pipe Industries. The company plans to raise Rs 130 crore through IPO. The funds raised from this will be used to expand the business of the company and meet the working capital requirements. If the price band is Rs 144-153 per share, then the lot size is 98 shares. In this context, it will be necessary to invest at least Rs 14994 in this. Under this, the allotment of shares will be done on April 8 and those who do not get the shares, the refund will start from April 11. The listing of the share can happen on April 13.
The company plans to set up a production unit at Sangareddy in Telangana with a capacity of 51,943 tonnes per annum. The company is planning to increase its mild steel pipe manufacturing capacity from 84,000 million tonnes to 1,32,000 million tonnes. For this the company will set up 2 pipe mills and for this the company will increase the capacity of its furnace from 95,832 to 1,04,232 mtpa.
(Disclaimer: IPO subscriptions are advised by experts. These are not the personal views of The Financial Express. Markets are subject to risk, so take expert opinion before investing.)
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