Ratnaveer Precision lists at Rs 129 at 31% premium over IPO price

by The Technical Blogs


Ratnaveer Precision Engineering made a decent stock market debut on Monday, opening at a 30.61 percent premium over its IPO price of Rs 98 per share. The stock commenced trading at Rs 129 on the Bombay Stock Exchange and Rs 123.20 on the National Stock Exchange.

This impressive listing is attributed to robust subscription figures and the overall positive momentum in the broader markets. The IPO witnessed an overwhelming response, with investors bidding for 110.79 crore equity shares, representing a subscription of 93.99 times the offer size of 1.17 crore shares.

Anubhuti Mishra, Equity Research Analyst at Swastika Investmart Ltd, said, “Ratnaveer Precision Engineering Limited (RPEL) made its stock market debut today, listing on the exchange at Rs 129 per share, a 31 per cent premium to its initial public offering (IPO) price of Rs 98.”

Established in 2002, Ratnaveer Precision Engineering Limited specializes in manufacturing stainless steel (SS) products, including finished sheets, washers, solar roofing hooks, pipes, and tubes.

The company’s revenue from operations demonstrated strong growth, with a Compounded Annual Growth Rate (CAGR) of 17.3 percent from FY20 to FY23. In FY23, consolidated sales reached Rs 479.75 crore, marking a 12 percent year-on-year increase. Net profit also surged by 164 percent YoY to Rs 25.04 crore.

“RPEL is a manufacturer of stainless steel products with a diverse range of products and designs. The company has a backward-integrated business model and a research and development (R&D) facility for new product development. It has also demonstrated strong financial performance over the past three years,” Mishra said.

Notably, Ratnaveer Precision Engineering Limited is the only listed company exclusively manufacturing finished sheets, washers, solar roofing hooks, pipes, and tubes in the stainless steel segment, as highlighted by Capital Market. Comparable peers in a similar line of business include Jindal Stainless, M.M. Forgings Limited, Menon Bearings Limited, and Venus Pipes & Tubes Limited.

At the issue price of Rs 98 per share, Ratnaveer’s Price-to-Earnings (P/E) ratio stands at 19x. In comparison, MM Forgings trades at a Trailing Twelve Months (TTM) P/E of 17.6x, Menon Bearings at 26.2x, Venus Pipes & Tubes at 58.7x, and Jindal Stainless at 17.3x.

“The IPO was well-received by investors, with the issue being subscribed to 93.99 times. The company’s strong fundamentals and good subscription levels are positive factors for this. Investors who participated in the IPO can consider booking profits, and those who want to hold may keep a stop-loss at around 116,” Mishra added.

(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not necessarily reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)

Published On:

Sep 11, 2023


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