Hariom Pipe IPO

Hariom Pipe Industries Limited is a complete producer of MS Pipes, Scaffolding, HR Strips, MS Billets, and Sponge Iron. They make Sponge Iron from iron ore, which is then processed through different steps to create their final products. Hariom Pipe IPO will hit the stock market in 30 March 2022.

About Hariom Pipe Industries

Their products are targeted towards the southern and western Indian markets. In these regions, their MS Pipes are promoted and sold under the name “Hariom Pipes.”

They employ a large percentage of their Sponge Iron, MS Billets, and HR Strips for captive consumption in the production of MS Pipes and Scaffolding. Their production process is more cost-effective thanks to MS Pipes and Scaffolding.

They make MS Pipes and Scaffoldings in over 150 different specifications to meet the needs of customers in a variety of industries, including housing, infrastructure, agricultural, automotive, power, cement, mining, solar power, and engineering.

Growth

Their company has entered a phase of expansion in order to gain scale and extend its line of value-added products. They intend to use the Net Proceeds of the Issue to expand its MS Pipe production capacity by constructing two (2) new pipe mills next to their current Unit I.

Their current capacity of 84,000 MTPA will be increased to 1,32,000 MTPA as a result of this development. They will also increase the capacity of their Furnace Unit, bringing their total production capacity to 1,04,232 MTPA, up from 95,832 MTPA now.

As part of their backward integration activities, their company purchased the Sponge Iron production plant, Unit II, in September 2020.

Production Plants

Their integrated facility in Telangana’s Mahabubnagar District (Unit I) produces finished steel products from iron scrap and Sponge Iron, while their other unit in Andhra Pradesh’s Anantapur District (Unit II) makes Sponge Iron solely.

Unit II lies near Bellary, which is one of the iron ore producing centres in South India. The iron ore used in Unit II’s Sponge Iron production is primarily obtained through an online bidding procedure.

The majority of Sponge Iron produced at Unit II is transferred to Unit I and utilised as a raw material in the production of MS Billets, HR Strips, MS Pipes, and Scaffolding.

Their reliance on 3rd parties has been decreased thanks to the manufacture of Sponge Iron at their Unit II.

Products

These are their main products which they produce in their manufacturing units:

• Sponge Iron

Sponge iron is a metallic product made by reducing iron ore in the solid form directly. It’s a scrap replacement that’s mostly utilised in the secondary steelmaking process. The goal of the sponge iron manufacturing process is to eliminate oxygen from iron ore. Sponge iron is an excellent steel scrap alternative for various steel/iron based commodities such as TMT bars, D.I Pipes (Ductile Iron Pipes), and so on. Sponge Iron is also an ideal material for use as a coolant in integrated steel plants’ Linz-Donawitz (LD) converters.

• MS Billets

Since raw steel cannot be used in its natural state, it must be cast into shape. Billets are newly produced steel that is still in the form of a metal bar or rectangle. Billets, also known as ingots, aren’t useful until they’ve been shaped into more usable forms and sizes.

While they have already been shaped and moulded in the furnace, they still need to go through a series of shaping and moulding procedures such as hot and cold working, milling, and cutting before being sold for various applications such as round bar, flat bar, angle plate, spring steel, wire rod, D-bar, and Hot/Cold Rolled Strips/ Coil.

• Ms Pipes

HR (Hot-Rolled) MS pipes are their main product. They produce square, rectangular, circular, and D-shaped portions in pipes, correspondingly. They make HR pipes in square portions up to 250x250mm, rectangular sections up to 300x200mm, and circular portions up to 300mm NB (nominal bore).

The thickness can range from 2 to 6 millimetres. Their goods are used in a variety of industries, including architecture, industrial, infrastructural, general engineering, power plants, solar power plants, steel plants, railroads, cement plants, mining, and etc.

Hariom Pipe IPO

Hariom Pipe Industry Limited, headquartered in Hyderabad has submitted Draft Red Herring Prospectus(DRHP) to Securities and Exchange Board of India(SEBI) for initial public offering (IPO) of 85,00,000 equity share on 18 September 2021.

The offer doesn’t includes any fresh equity shares and there is an offer for sale (OFS) of 85,00,000 equity share by the promoters mentioned in the DRHP.

They are now waiting for approval from Securities and Exchange Board of India(SEBI) to float the initial public offering (IPO) in the market.

Financials Trends

Particulars	For the year/period ended ( in Cr.)
		31-Mar-21	31-Mar-20	31-Mar-19
Total Assets		173.74	139.68	103.35
Total Revenue		254.82	161.15	133.92
Profit After Tax		15.13	7.91	8.02

Basic and Diluted Earnings Per Share

Financial Period	Basic EPS (in INR)	Diluted EPS (in INR)	Weight
Financial Year 2021	10.64	9.80	3
Financial Year 2020	5.98	5.93	2
Financial Year 2019	7.34	7.34	1
Weighted Average	8.54	8.10

Objects of the Issue

• Prepayment / repayment of all or a portion of the outstanding borrowings of the company to be availed on consolidated basis.
• To meet common corporate objectives.

Basis of the offer

The following basic parameters are used to calculate the Offer Price:

• The businesses’ integrated nature.
• The production method is environmentally friendly.
• Manufacturing Units is located in Strategic Locations.
• Product price is competitive.
• Promoters and leadership team with a lot of experience.

Hariom Pipe IPO Peer Comparison

S. No.	Face Value	Company Name	PE
1	2	APL Apollo Tubes Limited	76.68
2	10	Hi-Tech Pipes Limited	44.73
3	5	Rama Steel Tubes Limited	79.01
4	10	JTL Infra Limited	45.34

Hariom Pipe IPO Details

IPO Opening Date	30 March 2022
IPO Closing Date	05 April 2022
Issue Type	Book Building
Face Value	10 per share
IPO Price	144 to 153 per equity share
Market Lot	98 Shares
Min Amount	14,994
Listing At	BSE, NSE
Issue Size	85,00,000
Fresh Issue	–
Offer for Sale	–

Hariom Pipe IPO Date

Hariom Pipe IPO opening date is 30 Mar 2022, and the closing date is 05 April 2022. The Hariom Pipe IPO issue may list in 13 April 2022.

IPO Opening Date	30 Mar 2022
IPO Closing Date	05 April 2022
Basis of Allotment Date	11 April 2022
Initiation of Refunds	12 April 2022
Credit of Shares to Demat Account	12 April 2022
IPO Listing Date	13 April 2022

Basis of Allotment

Type	% of Offer	Basis of Allotment
Qualified Institutional Buyer	35	Roughly  Equivalent
Non Institutional Investor	30	Roughly Equivalent
Retail	35	Minimum level of 1 lot, based on availability, for every shareholder.

Hariom Pipe IPO Allotment Status

Allotment of equity stocks subject to the Fresh Issue and transfer of the Promoter Selling Shareholders’ OFS Stocks to the winning Bidders subject to the Offer for Sale. Nevertheless, the status of the allotment has yet to be revealed.

Here, you can find the Allotment Status of Hariom Pipe IPO.

Hariom Pipe IPO GMP

Hariom Pipe IPO Grey Market Premium is 0.

Date	GMP (in Rs)	Subject to Sauda	Kostak (in Rs)
April 2022
April 2022
April 2022
April 2022
April 2022
02 April 2022
01 April 2022
31 Mar 2022
30 Mar 2022
29 Mar 2022
28 Mar 2022
27 Mar 2022

Hariom Pipe IPO Review

Hariom Pipe IPO review : If you are looking answer regarding Hariom Pipe IPO is good or bad, you can apply for this IPO with long term view.

Hariom Pipe IPO Risk

• There are ongoing legal procedures against their firm, Promoters, and some Directors that might have a negative impact on their operations.
• The absence of major clients and reliance on smaller customers creates demand unpredictability, which might harm their firm.
• Consumed raw materials and stores account for a substantial portion of their overall costs.
• They have historically received a large part of their revenue from their top ten clients, and they may continue to do so in the future.
• Their firm might suffer if they are unable to effectively implement their projected expansion plans.
• Some contingent liabilities have not been accounted for in their financial statements.

Other Threats

• If low-quality counterfeit items using their brand name are offered in the markets, the value of their trademark “HARIOM PIPES” may be damaged.
• Considering their business is cyclical, the results of operations for any one quarter in a given year may not be consistent.
• Commodity price fluctuations may have an impact on the sales of their steel products and their operating performance.
• Their prospects may be harmed by stiff competition from Indian steel and steel goods companies.
• Extreme heat and fire are used in our production process. their company may be held accountable for damages and fines in the case of an accident, which might have a negative impact on our financials.

Product Quality

They want to improve their value offer even further by producing value added goods with higher margins and broader markets. Certain value-added goods necessitate changes and additions to their current product lines, which are still in development. The following are some value enhancements to their existing products:

• Rust-Free MS Pipes: These are anti-rust oil-coated MS Pipes that keep them from rusting.
• MS Pipe End Facing: This procedure gives the MS Pipe a softer finish, preventing damage from sharp edges.
• Packaging: To make moving our MS Pipes from one location to another easier, they utilise packaging strips/tapes.

Hariom Pipe IPO Brokerage views

• Yes Securities : Not Updated
• Choice Brokering: Not Updated
• Axis Securities: Not Updated
• IIFL Securities: Not Updated
• Trade swift: Not Updated
• Anand Rathi : Not Updated
• ICICI Securities: Not Updated

Hariom Pipe IPO Subscription Status

Date	Day	QIB	NII	Retail	Employees	Total Subscription
30 Mar 2022	1
31 April 2022	2
05 April 2022	3

Management

Their promoters and top management team have extensive expertise in this business, both in terms of product marketing and distribution.

Their Promoter, Mr. Rupesh Kumar Gupta, has over a decade of expertise in the iron and steel sector and has been the driving force behind their Firm’s success and business strategy.

Mr. Sailesh Gupta, their Promoter, has over a decade of expertise in the iron and steel sector and is constantly engaged in the Firm’s day-to-day operations, administration, and marketing.

They think that their management team’s expertise and knowledge of the business will allow them to continue to capitalise on existing and future possibilities.

Promoters

• Rupesh Kumar Gupta
• Sailesh Gupta

Promoter’s Holding

Pre Issue Share Holding	42.00%
Post Issue Share Holding