NATIONAL, MUMBAI, 20 JUNE, 2024 (GPN): Vraj Iron and Steel, a prominent player in the steel manufacturing sector, has announced the launch of its Initial Public Offering (IPO), scheduled to open on June 26. The IPO will offer fresh equity shares in the price band of Rs. 195 to Rs. 207 per share, with the company aiming to raise Rs. 171 crore.

The Company proposes to utilize net proceeds towards funding for (i) Capital Expenditure towards the “Expansion Project” at Bilaspur Plant estimated to be Rs. 1,645 million [Rs. 164.50 crore] and (ii) balance amount towards General corporate purpose.

The capital expenditure estimated to be Rs. 1,645 million [Rs. 164.50 crore] towards Capital expenditure for the “Expansion Project” at Bilaspur Plant. The Company has already deployed Rs. 700 million [Rs. 70 crore] from loan from HDFC Bank which is proposed to be repaid from net proceeds of the IPO. For the balance amount of Rs. 945 million [Rs. 94.5 crore] the Company has already deployed Rs. 320 million [Rs. 32.00 crore] from internal accrual and further wish to deploy Rs. 30 million [Rs. 3.00 crore] from internal accruals. The rest of the Rs. 595 million [Rs. 59.5 crore] is further to be funded from the net proceeds of the IPO in FY 2024-25.

Vraj Iron and Steel operates two manufacturing plants in Chhattisgarh, with plans to increase its aggregate installed capacity from 2,31,600 tons per annum (TPA) to 5,00,100 TPA across its production facilities. This expansion includes scaling up its captive power plant’s capacity from 5 MW to 20 MW, aimed at reducing energy costs and ensuring operational resilience.

The IPO will be conducted through the book-building process, with allocation percentages set at up to 50% for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors, and a minimum of 35% for Retail Investors. Retail investors can participate with a minimum lot size of 72 shares, requiring an investment of Rs. 14,904.

Aryaman Financial Services Limited is acting as the book-running lead manager for the IPO, while Bigshare Services Pvt. Ltd. has been appointed as the registrar.

Investors and industry stakeholders are closely watching the developments at Vraj Iron and Steel, anticipating the company’s growth trajectory amidst its strategic expansion plans and the evolving market dynamics in the steel sector.

The RHP is available on the website of the SEBI at www.sebi.gov.in, the website of the BSE Limited at www.bseindia.com and the website of the National Stock Exchange of India Limited at www.nseindia.com and the website of the Book Running Lead Manager to the Issue, Aryaman Financial Services Limited at www.afsl.co.in.

• RHP Link: 

https://www.afsl.co.in/pdfnew/Vraj%20Iron%20and%20Steel%20Limited%20-%20RHP.pdf