Beezaasan Explotech has established itself as one of India’s leading manufacturers of world-class explosives, with an impressive track record of over 60 years in the business. Known for its superior service and safety standards, the company has built a reputation for exceeding customer expectations. Its legacy is passed down through generations, leveraging decades of mining and industry experience to develop and produce revolutionary explosive products.

Beezaasan Explotech IPO Details

The Beezaasan Explotech IPO is a book-built issue that will raise ₹59.93 crores by issuing 34.24 lakh fresh equity shares. The price band for the shares is set between ₹165 and ₹175 per equity share. At the upper price band of ₹175, the market capitalization of the company will be ₹227.15 crores. The lot size for the IPO is 800 shares, and retail investors will be required to invest a minimum of ₹1,40,000, while High-Net-Worth Individuals (HNIs) will need to invest at least ₹2,80,000 for two lots (1,600 shares).

The subscription period for the IPO opens on February 21, 2025, and closes on February 25, 2025. Afterward, the allotment is expected to be finalized by February 27, 2025, and the shares will be listed on BSE SME on March 3, 2025.

Grey Market Premium and Market Insights

Currently, the Grey Market Premium (GMP) for the Beezaasan Explotech IPO is reported at ₹0, signaling no significant demand in the informal market. This premium is based on unorganized market trends, and it is important to note that the GMP has no bearing on the final listing price, which will be determined once the shares are officially listed on the exchange.

Given the current market sentiment and the minimal GMP, investors are advised to consider the fundamentals of the company and the IPO pricing rather than relying on unorganized market data.

IPO Allotment Process and Status Updates

The IPO allotment will be available on February 27, 2025. Investors can follow these steps to check the allotment status:

• Visit the IPO allotment status page.
• Choose Beezaasan Explotech Limited from the dropdown.
• Enter application details such as PAN, DP Client ID, or application number.
• Submit the form to view your allotment status.

This process ensures that investors can easily track their investments and determine whether they have been allotted shares.

Use of Proceeds from the IPO

Beezaasan Explotech plans to utilize the net proceeds raised from the IPO for the following purposes:

• ₹387.47 lakh will be allocated for capital expenditure towards civil construction for the expansion of its manufacturing units in Gujarat, specifically for the Emulsion Explosive-3 Plant, Emulsion Bulk Explosive Plant, and Detonating Fuse Plant.
• ₹2,304.30 lakh will go towards purchasing plant machinery for the same expansion.
• ₹202.56 lakh will be used for expanding additional storage facilities for Emulsion Cartridge Explosives and Detonating Fuse.
• ₹144.40 lakh will be utilized for the purchase of commercial vehicles.
• ₹1,800 lakh will be directed towards the repayment of borrowings.
• The remaining funds will be used for general corporate purposes.

Financial Performance Review

Beezaasan Explotech has shown steady growth in its financial performance over recent years. For the period ending September 30, 2024, the company reported revenues of ₹10,144.44 lakh, an increase from ₹14,190.54 lakh in FY2022. The EBITDA for the period was ₹1,416.03 lakh, reflecting a solid profit margin.

The Profit after Tax (PAT) for FY2024 stood at ₹832.86 lakh, up from ₹274.25 lakh in FY2022, indicating a strong growth trajectory.

The company’s pre-issue EPS stands at ₹6.04, while the post-issue EPS is expected to be ₹3.75 for FY24. With a P/E ratio of 28.97x (pre-issue) and 46.68x (post-issue), Beezaasan Explotech's valuation is aligned with industry standards. The company's ROCE for FY24 is 16.20%, and its ROE is 25.93%, indicating solid returns for shareholders.

Conclusion: Avoid for Listing Gains

The Grey Market Premium for the Beezaasan Explotech IPO is currently at ₹0, reflecting minimal demand in the informal market. Despite the company's strong financials and growth potential, investors should approach the IPO with caution, particularly those looking for quick listing gains. The IPO may be a solid long-term investment opportunity for those seeking to invest in a company with a strong legacy and expanding operations in the explosives industry. However, the current market sentiment suggests that short-term gains may be limited.

The Upcoming IPOs in this week and coming weeks are Beezaasan Explotech, Nukleus Office.

The Current active IPO are Swasth Foodtech, HP Telecom India.

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