About Parmeshwar Metal Limited

BUSINESS OVERVIEW

Parmeshwar Metal Limited specializes in manufacturing copper wires and copper wire rods through copper scrap recycling. These products cater to diverse applications, including power cables, building wires, transformers, automotive, household cables, and bare or enamelled wires. The product portfolio features 1.6 MM copper wire and 8 MM & 12.5 MM copper wire rods, customizable to meet specific customer needs. An in-house testing lab ensures that raw materials and finished products meet stringent quality standards.

Emphasis on health and safety includes the provision of tools like fire safety helmets, gloves, goggles, and welding visors. Copper recycling is environmentally significant as it reduces energy consumption compared to primary production and conserves natural resources. The facility utilizes advanced equipment, including a Melting Furnace, Rolling Mill, Compressed Air Dryer, and Oxygen Analyzers. The promoters, with over 30 years of experience in the metal industry, oversee quality control, process improvement, marketing, financial planning, and vendor management, driving consistent growth. The company's vision focuses on delivering high-quality products tailored to meet customer demands efficiently.

As on October 31, 2024 the company have total 26 Employees and 45 Contract Labour. The Bankers to the Comapny is State Bank of India.

INDUSTRY ANALYSIS

INDUSTRY – COPPER
Copper is a malleable and ductile metallic element that is an excellent conductor of heat and electricity as well as being corrosion resistant and antimicrobial. Copper occurs naturally in the Earth’s crust in a variety of forms. It can be found in sulfide deposits (as chalcopyrite, bornite, chalcocite, covellite), in carbonate deposits (as azurite and malachite), in silicate

deposits (as chrysycolla and dioptase) and as pure "native" copper. Copper isthe second largest non-ferrous metal by usage, with global demand of refined copper was about 25.04 million tonnes in 2020. Most commercial copper ore deposits contain average grade of 0.8% copper, while copper ore in India has an average copper content of around 1%.

There are two methods of mining copper minerals open pit and underground. Open- pit mining accounts for 80% of all copper mining operations in the world.

Chile accounted for almost a third of copper mine production & Peru accounted for 10 % of world mine production in 2020.
In 2020, China accounted for almost 50% of world smelter production, followed by Japan (8%), Chile (6%) & Russian federation (5%).
China accounted for 41 % world refined copper production, followed by Chile (10%), Japan (6%) and Congo (5%) in 2020.

With the approval of Hon’ble Minister of Mines ‘Non-Ferrous Metal Import Monitoring System (NFMIMS)’ for the imports of Aluminium and Copper items to cover 43 Aluminium items under HS code 76 and 46 Copper items under HS code 74 respectively, has been introduced w.e.f. vide notification No. 61/2015-2020 dated 31.03.2021. The purpose of system is to have adequate information with regard to import of Aluminium and Copper so that an appropriate policy intervention could be devised well in time. This system also provides information to stakeholders and has a significant catalyst in “Atmanirbhar Bharat” and “Vision 2030 for the Aluminium industry.”

Production level of important minerals in February, 2024 were: Coal 966 lakh tonne, Lignite 42 lakh tonne, Natural gas (utilized) 2886 million cu.m., Petroleum (crude) 23 lakh tonne, Bauxite 2414 thousand tonne, Chromite 400 thousand tonne, Copper conc. 11 thousand tonne , Gold 255 kg, Iron ore 244 lakh tonne, Lead conc. 27 thousand tonne, Manganese ore 295 thousand tonne, Zinc conc. 149 thousand tonne, Limestone 387 lakh tonne, Phosphorite 218 thousand tonne, and Magnesite 10 thousand tonne. Important minerals showing positive growth during February, 2024 over February, 2023 include: Gold (86%), Copper Conc. (28.7%), Bauxite (21%), Chromite (21%), Phosphorite (19%), Limestone(13%), Coal (12%), Natural gas (U) (11%), Petroleum(crude) (8%), Manganese Ore (6%), Magnesite (3%), Lignite(2.8%), and Zinc Conc.(2.8%). Other important minerals showing negative growth include Iron Ore (-0.7%) and Lead Conc.(-14%). The index of mineral production of the mining and quarrying sector for the month of February 2024 at 139.6, was 8% higher compared to the level in the month of February 2023. India's overall coal production has seen a quantum jump to 893.08 MT in FY23 as compared to 728.72 MT in FY19 with a growth of about 22.6%. In FY24, the coal production stood at 997.25 MT, registering a growth of 12% from last year. In June 2024, India's coal production reached 84.63 million tonnes (MT) (Provisional), exhibiting a growth rate of 14.49% compared to the corresponding period of the previous year, which stood at 73.92 MT.

In April-May 2024, the production of crude steel stood at 20.719 MT and that of finished steel was 23.712 MT. In FY23, production of crude steel stood at 125.32 million tonnes (MT), finished steel at 121.29 MT and consumption of finished steel at 119.17 MT has exceeded their respective levels achieved over the corresponding period of not only COVID affected last two years but also pre COVID years as well. India's Iron ore production reached a new high of 277 million metric tonne (MMT) in FY24, up 7.4% from 258 MMT in FY23. In 2022-23, exports of iron ore stood at US$ 1.75 billion as compared to US$ 3.18 billion in 2021-22. The production of aluminium was 4.07 MT in FY23. The index of mineral production of mining and quarrying sector for the month of December 2023 (Base: 2011-12=100) stood at 139.4, 5.1 % higher compared to the level in the month of December 2022. According to provisional data from the Indian Bureau of Mines (IBM), the cumulative growth for the period April- December, 2023-24 over the corresponding period of previous year is 8.5 % percent. In FY23, mineral production is estimated at Rs. 1,18,246 crore (US$ 14.37 billion). In FY22, mineral production was estimated at Rs. 1,32,747 crore (US$ 16.04 billion). India ranks fourth globally in terms of iron ore production. India's iron ore production is estimated to stand at 257.85 MT in FY23, while it stood at 253.97 MT in FY22, up 23% from FY21. In FY22, India had a total number of 901 steel plants producing crude steel. In April-January FY24, the production of crude steel stood at 118.372 MT and that of finished steel was 113.848 MT. India’s steel production is estimated to grow 4-7% to 123-127 MT in FY24. In April-January FY24, production of hot metal, crude steel and saleable steel by SAIL stood at 16.97 MT, 15.94 MT and 15.30 MT, respectively. Aluminium production in India stood at 3.47 MT between April-January FY24. The world production of Primary Aluminium during April-May 2024, was 11.92 million tons against world consumption of 12.27 million tons, resulting in a market deficit of 0.359 million tons. The share of India in the world production was 5.8% during April-June 2024.

BUSINESS STRENGTHS

1. Experienced Promoters and Management Team: Led by promoters with over 30 years of experience in the metal industry, the management team drives growth through strategic planning and operational excellence. A motivated and skilled workforce ensures competitive advantage and high client satisfaction.

2. Strong Customer Relationships: Long-standing ties with key customers across industries such as power cables, automotive, transformers, and household wires ensure uninterrupted product supply and sustained business growth.

3. Quality Assurance: Products are ISO 9001:2015 certified, with rigorous quality checks at every stage—from raw material procurement to final dispatch. Supplier inspections and in-house lab testing ensure adherence to the highest quality standards.

4. Customized Product Offerings: Copper wires (1.6 MM) and copper wire rods (8 MM & 12.5 MM) are tailored to specific customer needs, optimizing resource utilization and enhancing profitability.

5. Diversified Raw Material Sourcing: Copper scrap is sourced from multiple Indian states, including Gujarat, West Bengal, and Tamil Nadu, as well as international markets like UAE, Hong Kong, and Singapore, ensuring a robust supply chain.

BUSINESS STRATEGIES

1. Leveraging Market Skills and Relationships: The company focuses on building strong relationships with marketers and customers by applying operational expertise, marketing skills, and industry connections to enhance customer satisfaction and loyalty.

2. Maintaining a Competitive Edge: As an ISO 9001:2015 certified manufacturer, the company specializes in customized copper wire rods from recycled scrap, leveraging skilled labor, advanced technology, and quality materials. Continuous improvement in execution capabilities ensures superior product quality and operational efficiency, distinguishing the company from competitors.

3. Striving for Cost Efficiency: Emphasis on operational effectiveness leads to increased production volumes and reduced fixed costs, enhancing profit margins. Targeting economies of scale further optimizes procurement and strengthens cost efficiency.

4. Expanding Geographical Presence: With a strong foothold in states like Gujarat, Maharashtra, and Tamil Nadu, the company aims to deepen its market penetration, expand into new regions, and cater to growing customer demand through quality assurance and reliable delivery.

5. Focus on Quality: Rigorous quality control, backed by ISO 9001:2015 certification and in-house testing, ensures adherence to stringent standards from raw material procurement to final products. This commitment to quality builds trust and strengthens the company’s reputation in the copper wire rod industry.

6. Forward Integration: Investing in machinery for manufacturing bunched copper wire rods enhances value creation, strengthens supply chain control, and boosts operational efficiency. This strategy aligns with market demands, improves profitability, and supports long-term growth and market share expansion.

BUSINESS RISK FACTORS

1. Geographical Concentration Risk: The company's operations are primarily concentrated in Gujarat, with the manufacturing facility located in Gandhinagar, Dehgam. A significant portion of revenue is generated from this state. Any adverse developments, such as social, political, economic disruptions, natural calamities, or policy changes by state or central governments, could necessitate substantial adjustments to business strategies and result in negative impacts on operations, financial condition, and cash flow.

2. Raw Material Price Volatility: The cost of production is highly dependent on copper scrap, which constitutes over 93% of total income in recent financial years. Reliance on spot market procurement without long-term supply agreements exposes the business to price fluctuations. Inability to pass on increased raw material costs to customers or maintain affordability could compress profit margins, directly affecting profitability and financial stability.

3. Dependency on High Volume, Low Margin Sales: Profitability relies on consistent growth in the production and sales volume of copper wire rods. Limited scope for higher product margins makes efficient management of key business processes—such as raw material procurement, sales execution, and cost control—critical. Failure to scale operations effectively may lead to reduced profitability and strain financial performance.

NOTE : Parmeshwar Metal Company faces three primary risk factors. First, its operations are geographically concentrated in Gujarat, making it vulnerable to disruptions or policy changes in the state. Second, the business is exposed to significant fluctuations in copper scrap prices due to reliance on spot market procurement, which could affect profit margins and overall financial health. Third, its dependency on high-volume, low-margin sales requires efficient scaling and process management to sustain profitability, with any inefficiencies posing a direct threat to its financial performance.