The Initial Public Offering (IPO) of Hariom Pipe Industries Limited ("Company"), an integrated manufacturer of Mild Steel (MS) Pipes, Scaffolding, HR Strips, MS Billets, and Sponge Iron, received bids of 6,74,04,596 shares against the offered 85,00,000 equity shares, at a price band of ₹144-153, according to the data available on the BSE website. Overall the issue was subscribed 7.93 times on the final day of bidding.
The Retail portion was the most subscribed with 12.15 times followed by non-institutional investors with 8.87 times. The reserved portion of qualified institutional buyers witnessed a subscription of 1.91 times. The issue kicked off for subscription on Wednesday, March 30 and closes on Tuesday, April 5.
Brokerage Houses like Anand Rathi, Arihant Capital Market, Choice Broking, Hem Securities, Marwadi Shares and Finance, Ventura Securities etc. have recommended "Subscribe" rating to the issue.
According to the Brokerage houses, the issue is valued at a EV/EBITDA of 10.2x based on FY21 EBITDA. From FY19 to FY21, the company had excellent sales growth while maintaining a stable margin profile. Plants strategically positioned with integration, competitive product pricing, cost effectiveness, capacity expansion, experienced management, and a growing network will drive future success. HPIL is fairly valued when compared to its listed competitors.
Headquartered in Hyderabad, Telangana, Hariom Pipe Industries Limited manufactures steel products and has a wide distribution network in South India. The Company caters directly and indirectly to customer requirements in various sectors such as Housing, Infrastructure, Agriculture, Automotive, Solar Power, power, cement, mining and Engineering.
The proceeds from the fresh issue to the tune of Rs. 50.05 crore will be used for funding capital expenditure requirements; Rs. 40 crore will be used for funding working capital requirements and remaining for general corporate purpose.
ITI Capital Limited is the sole Book Running Lead Manager ("BRLM") to the Offer.