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Ratnaveer Precision Engineering IPO

ratnaveer precision engineering IPO
The Indian stainless-steel sector is the second largest producer and consumer in the world and has a total manufacturing installed capacity of more than 6.5 Mn tons of stainless steel annually. Higher levels of chromium and additions of other alloy elements enhance the corrosion resistance.  Compared to traditional steel, stainless-steel has a higher resistance to corrosion, superior aesthetic finish and higher life span.  These features have helped in increasing the popularity of stainless steel across the world. India produced approximately 67.9 Mn tons of steel during the January to June 2023 period, which was nearly 7.4% higher than same period previous year. Unless there are no major disruptions, Indian steel industry would end the year with approximately 136 Mn tons of crude steel. India produced 125.3 Mn tons of crude steel in CY22 and accounted for 7% share of global crude steel production. The rapid rise in demand for stainless steel and India’s growth in the international market benefits companies like Ratnaveer Precision Engineering Ltd. (RPEL)

Ratnaveer Precision Engineering Ltd. was incorporated in 2002 and manufactures stainless steel finished sheets, washers, solar roofing hooks, pipes, and tubes. The company manufactures stainless steel-based products for automotive, solar power, wind energy, power plants, oil & gas, pharmaceuticals, sanitary & plumbing, instrumentation, electromechanics, architecture, building & construction, electrical appliances, transportation, kitchen appliances, chimney liners, and other industries. It has 4 manufacturing units out of which two units out of which the company manufactures SS finishing sheets, SS washers, and SS solar mounting hooks at Unit I and SS pipes & tubes at Unit II. Unit III and Unit IV are dedicated to the backward integration process. Unit III is the melting unit where melted steel scrap is turned into steel ingots, and Unit IV is the rolling unit where flat ingots are further processed to turn them into SS sheets which are the raw material for SS washers. The company is planning to increase product portfolio by introducing new designs like circlips into the product line. RPEL’s portfolio currently comprises of over 2,500 SKUs of SS washers. Having a wide range of products not only enables it to meet the trends and ever changing demands of its customers but also gives the company an edge to efficiently compete with its competitors. Its product portfolio also includes a diversified variety of stainless steel pipes in various specifications and sizes having wide applications in varied industries. Its constant efforts are focused towards identifying customer requirements and introducing high-quality products which are in demand.

RPEL’s total revenue increased by INR 526.73 million, or by 12.29%, from INR 4,284.72 million in FY22 to INR 4,811.45 million in FY23. The company has recorded an increase in its profit by 164.29% in FY23 to INR 250.44 million in FY23 with ROE and ROCE of 29.12% and 12.62% in FY23 compared with 15.46% and 9.67% in FY22.

Objects of the issue:
1. Funding working capital
2. General corporate purposes

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