Aditya Ultra Steel Ltd operates in the steel manufacturing sector, specifically focusing on producing TMT bars under the Kamdhenu brand. These products are primarily used in construction and infrastructure development. The company's core operation involves manufacturing TMT bars from billets through a reheating furnace and rolling mill process. This positions Aditya Ultra Steel as an essential player in supporting India's infrastructure growth, an industry poised for continued expansion.

The Aditya Ultra Steel IPO, a Book Built Issue amounting to ₹45.88 Crores, opened for subscription on September 9, 2024, and closed on September 11, 2024. The issue consists entirely of a fresh issue of 74 lakh shares, with a price band set between ₹59 to ₹62 per share. Investors can check the IPO allotment status on September 12, 2024, with the shares expected to list on BSE and NSE on September 16, 2024.

Business Overview and Promoters

Aditya Ultra Steel's business focuses on manufacturing rolled steel products, including TMT bars, which are essential in infrastructure development. These products cater to the construction industry, offering strength and durability in various projects. The company follows a vertically integrated model, processing raw materials like billets in its reheating furnace and then rolling them into TMT bars.

Promoted by a group of seasoned entrepreneurs with a collective 17 years of experience in the steel industry, including Varun Manojkumar Jain, Sunny Sunil Singhi, and Varuna Jain, the company has grown steadily over the past few years. Their combined leadership ensures strategic growth, focusing on innovation and quality in the steel manufacturing process.

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IPO Details and Pricing

The Aditya Ultra Steel IPO is priced in the range of ₹59 to ₹62 per share, with a minimum lot size of 2,000 shares. Retail investors need to invest a minimum of ₹124,000, while HNIs must invest a minimum of ₹248,000 for two lots.

The book-running lead manager for this IPO is Swastika Investmart Limited, and Cameo Corporate Services Limited is the registrar. The market maker for this issue is Sunflower Broking Private Limited.

Financial Performance

Aditya Ultra Steel has shown steady financial growth, with revenue increasing from ₹51,598.34 Lakhs in FY22 to ₹58,856.29 Lakhs in FY24. The EBITDA for FY24 stands at ₹1,801.39 Lakhs, reflecting improved operational efficiency compared to ₹1,091.53 Lakhs in FY22. Meanwhile, the company's Profit After Tax (PAT) surged from ₹488.90 Lakhs in FY22 to ₹792.34 Lakhs in FY24.

While the company’s financial growth appears stable, the profitability ratio metrics such as Return on Capital Employed (ROCE) at 18.75% and Return on Equity (ROE) at 23.92% highlight a balanced but modest performance compared to industry peers. The company's pre-issue EPS is ₹4.62, while the post-issue EPS is expected to decline to ₹3.19, suggesting dilution in shareholding.

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Grey Market Premium (GMP) and Subscription Status

The Grey Market Premium (GMP) for the Aditya Ultra Steel IPO is expected to be in the range of ₹6 to ₹10, suggesting a 12% to 16% potential listing gain. However, investors should note that Grey Market Premium is influenced by demand and supply dynamics in an unofficial market and may not accurately predict the listing price.

As of 7:00 PM on September 11, 2024, the IPO was subscribed 10.22 times, indicating a moderate level of interest from investors. To check the live subscription status, refer to {Finance Saathi Telegram Channel}.

Allotment and Listing

The Aditya Ultra Steel IPO allotment date is scheduled for September 12, 2024, and investors can check the allotment status on the registrar’s website or {Best IPO to Apply Now - IPO List 2024, Latest IPO, Upcoming IPO, Recent IPO News, Live IPO GMP Today - Finance Saathi}.

To check the allotment status:

Visit the IPO allotment status page on Cameo Corporate Services.

Select Aditya Ultra Steel IPO from the dropdown list.

Enter your application number, PAN, or DP Client ID.

Submit the details to view your allotment status.

For the latest updates on allotment and listing, you can also explore {Top News Headlines - Share Market News, Latest IPO News, Business News, Economy News - Finance Saathi}.

Objectives of the IPO

The proceeds from the Aditya Ultra Steel IPO will be utilized for:

₹1,535 Lakhs for capital expenditure to enhance production capacity.

₹1,535 Lakhs for working capital requirements to support operational efficiency.

Funds for general corporate purposes.

To meet public issue expenses.

The focus on expansion and working capital suggests that Aditya Ultra Steel is committed to scaling operations and meeting the growing demands of the construction industry.

Conclusion

The Aditya Ultra Steel IPO offers a chance to invest in a well-established player in the steel manufacturing sector, particularly catering to the growing demands of infrastructure development in India. Despite its moderate financial performance and the relatively high P/E ratio post-issue, the company's Grey Market Premium suggests potential for listing gains. However, with dilution in earnings and modest growth rates, it may not appeal to long-term investors.

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