Vraj Iron and Steel IPO opens. Should you subscribe to this issue?
IPO) of Vraj Iron and Steel opened for subscription earlier today. The company plans to raise around Rs 171 crore through the issue, which closes on June 28.
The IPO comprises only a fresh equity issue of up to Rs 171 crore.
The company proposes to utilise the net proceeds towards funding for its capital expenditure requirement towards the expansion of project at Bilaspur Plant estimated to be at Rs 164.50 crore and the balance amount towards general corporate purposes.
Vraj Iron has already deployed a Rs 70 crore loan from HDFC Bank which is proposed to be repaid from net proceeds of the IPO. For the balance amount of Rs 94.5 crore, the company has already deployed Rs 32 crore from internal accruals and further wish to deploy Rs 3 crore from internal accruals.
Vraj Iron and Steel IPO review
Analysts advised investors to subscribe to the IPO as the company's well-established and strategically located manufacturing facilities, coupled with a focus on value-added products and ongoing expansion plans, position it for future growth.
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«The IPO's P/E valuation of 9.48x appears reasonable. Considering the potential for long-term growth and the possibility of modest listing gains, we recommend a subscribe rating,» said Swastika Investmart.
Vraj Iron and Steel IPO price band
The company has a fixed price band at Rs 195-207 per equity share, where investors can bid for 72 shares in one lot.
About 50% of the issue will be available
