Shree Tirupati Balajee Agro Trading Company Limited (STB) is a prominent player in the Flexible Intermediate Bulk Container (FIBC) industry in India. Known for its high-quality manufacturing and expansive domestic and international footprint, STB is a leading manufacturer and supplier of FIBC products. The company has carved a niche as a premier destination for world-class bulk packaging solutions, catering to a wide array of discerning global customers.

The Shree Tirupati Balajee Agro Trading IPO is set to open on September 05, 2024, with a price band of ₹78 to ₹83 per share. The IPO comprises a fresh issue of 14.75 lakh shares worth ₹122.42 crores and an offer for sale of 5.69 lakh shares totaling ₹47.22 crores, aggregating to a total issue size of ₹169.64 crores. Retail investors will need to invest a minimum of ₹14,940 for 180 shares, while High-Net-Worth Individuals (HNIs) must invest a minimum of ₹209,160 for 2,520 shares. The subscription period will close on September 09, 2024, with the allotment scheduled for September 11, 2024, and shares are expected to list on the BSE and NSE on September 12, 2024.

The proceeds from the IPO will be allocated as follows:

₹31.45 crores will be used for the repayment and/or prepayment of outstanding borrowings.

₹20.82 crores will be invested in subsidiaries HPPL, STBFL, and JPPL for similar purposes.

₹13.50 crores will fund incremental working capital requirements.

₹10.74 crores will be used for investment in subsidiaries for working capital needs.

The remaining funds will be used for general corporate purposes.

Financially, STB has shown consistent growth. Revenue increased from ₹45,378.77 million in FY22 to ₹47,813.65 million in FY23, reaching ₹55,282.11 million in FY24. EBITDA also grew from ₹4,051.35 million in FY22 to ₹7,507.04 million in FY24. Profit After Tax (PAT) rose from ₹1,365.90 million in FY22 to ₹3,607.27 million in FY24. This steady growth highlights the company’s robust financial health and operational efficiency.

For the IPO, the pre-issue Earnings Per Share (EPS) is ₹5.74, and the post-issue EPS is ₹4.42. The pre-issue Price-to-Earnings (P/E) ratio is 14.48x, and the post-issue P/E ratio is 18.77x, compared to the industry average of 30.74x. The Return on Capital Employed (ROCE) for FY24 is 16.29%, and the Return on Equity (ROE) is 20.84%, suggesting that the IPO is reasonably priced.

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The Grey Market Premium (GMP) for STB is currently estimated to be between ₹30 and ₹35, indicating potential listing gains of 35% - 40%. This suggests a positive outlook for the IPO, though the GMP should be considered for informational purposes only, as actual trading can vary.

Investors interested in the Shree Tirupati Balajee IPO should keep an eye on the subscription status starting September 05, 2024, and check their allotment status on September 11, 2024. The IPO proceeds will support the company's growth plans and strengthen its position in the FIBC market.

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