Royal Arc Electrodes Ltd
Royal Arc Electrodes Ltd IPO: Comprehensive Details for Investors
Royal Arc Electrodes Ltd, a prominent player in the welding consumables industry, has announced its Initial Public Offering (IPO). This article provides an in-depth look into the company’s background, IPO specifics, financial health, strengths, potential risks, and other pertinent details to assist investors in making informed decisions.
Company Overview
Established in 1996, Royal Arc Electrodes Ltd specializes in manufacturing and supplying a diverse range of welding consumables, including welding electrodes, flux-cored wires, and MIG/TIG wires. These products cater to various industries such as railways, refineries, shipyards, and infrastructure projects. The company’s state-of-the-art manufacturing facility, located in Zaroli, Umbergaon Valsad, Gujarat, spans approximately 25,082.61 square meters. With a strong commitment to quality, Royal Arc holds ISO 9001:2015 certification and exports its products to over 20 countries worldwide.
IPO Timeline and Details
The Royal Arc Electrodes IPO is scheduled to open on February 14, 2025, and will close on February 18, 2025. The company aims to raise ₹36.00 crore through this IPO, offering a total of 30,00,000 equity shares. The price band is set between ₹114 to ₹120 per share, with a lot size of 1,200 shares, requiring a minimum investment of ₹1,36,800. The shares are proposed to be listed on the NSE SME exchange.
Key Dates
| Event | Date |
|---|---|
| IPO Opening Date | February 14, 2025 |
| IPO Closing Date | February 18, 2025 |
| Basis of Allotment Finalization | February 19, 2025 |
| Refunds Initiation | February 20, 2025 |
| Credit of Shares to Demat Accounts | February 20, 2025 |
| Listing Date | February 21, 2025 |
Financial Highlights
Over the past three fiscal years, Royal Arc Electrodes Ltd has demonstrated consistent financial growth:
| Fiscal Year Ending | Revenue (₹ in Lakhs) | Profit After Tax (₹ in Lakhs) |
|---|---|---|
| March 31, 2022 | 6,290.97 | 212.13 |
| March 31, 2023 | 9,694.02 | 956.82 |
| March 31, 2024 | 9,978.75 | 1,192.63 |
This upward trajectory indicates the company’s robust market position and operational efficiency.
Strengths
- Diverse Product Portfolio: Offers a wide range of welding consumables catering to multiple industries.
- Global Presence: Exports products to over 20 countries, showcasing international market acceptance.
- Quality Certifications: Holds certifications from esteemed bodies like ABS, IBR, and BIS, ensuring adherence to international standards.
- Experienced Leadership: Managed by professionals with over 30 years of experience in the welding industry.
Risks
- Market Dependency: Reliance on specific industries may pose risks if those sectors experience downturns.
- Single Manufacturing Facility: Operations are concentrated in one location, which could be a vulnerability in case of regional disruptions.
- Workforce Size: With a relatively small team of 144 employees, scaling operations rapidly might present challenges.
IPO Anchor Investors Details
As of now, specific details regarding anchor investors have not been disclosed. Investors are advised to monitor official communications from the company for updates in this regard.
IPO Promoter Holding
| Promoter Name | Shares Offered for Sale |
|---|---|
| Hardik Sanghvi | 3,33,000 |
| Swagat Sanghvi | 3,33,000 |
| Bipin Sanghvi | 1,71,000 |
| Tarulata Sanghvi | 1,23,000 |
| Pooja Sanghvi | 1,20,000 |
| Ami Sanghvi | 1,20,000 |
Note: The above table reflects the shares offered for sale by each promoter as part of the Offer for Sale (OFS) component of the IPO.
IPO Grey Market Premium (GMP)
As of February 15, 2025, there is no active Grey Market Premium (GMP) for the Royal Arc Electrodes IPO. Investors should note that GMP is speculative and can fluctuate; it does not guarantee the listing performance of the stock.
Final Thoughts
Royal Arc Electrodes Ltd presents a compelling opportunity for investors, backed by a strong financial track record, diverse product offerings, and a significant global footprint. However, potential investors should carefully consider the associated risks, including market dependency and operational concentration. Conducting thorough due diligence and consulting with financial advisors is recommended before making investment decisions.