Newmalayalam Steel Limited is coming up with an IPO with a fresh issue of 46,40,000 shares worth INR 41.76 crores. The company aims to upgrade technology, expand facilities, fund growth, and enhance brand presence. 

Newmalayalam Steel IPO – Important Dates 

Read more about Newmalayalam Steel Limited IPO GMP

Newmalayalam Steel Limited IPO – Company Profile 

Newmalayalam Steel Limited was incorporated in 2017 through the acquisition of M/s. Demac Steel began manufacturing galvanised pipes, tubes, and sheets in 2018, addressing Kerala’s construction needs with durable, rust-free products. 

The company markets its products through a strong dealer network in Kerala, supporting local contractors and retailers. Formal agreements ensure margins and boost brand presence, with additional sales via promoter Jaihind Steel Private Limited. 

The company has established itself as a preferred brand for galvanised tubes and pipes in Kerala. To maintain and expand its market presence, it has leveraged stringent quality control, innovative marketing, customer engagement, and a strong distribution network. 

Newmalayalam Steel Ltd IPO Fundamental Analysis 

Newmalayalam Steel Limited’s financial analysis reveals a mixed performance. Revenue growth reflects a positive trend, but declining profitability, reduced EPS, and lower return on net worth suggest financial performance and liquidity challenges. 

• Revenue Trend: The revenue increased from ₹31,791.72 lakhs in March 2022 to ₹35,479.84 lakhs in March 2023. The revenue for the current year’s 6-month period ending September 2024 is INR 15,421.42 lakhs.
• Equity and Liabilities: Equity has shown a consistent increase over the periods, reflecting potential growth and expansion. 
• Profitability: The profit after tax (PAT) has significantly decreased from ₹673.06 lakhs in March 2022 to ₹519.30 lakhs by September 2024. This decline in profitability could be a source of concern among investors. 
• Earnings per Share (EPS): The diluted EPS has reduced from ₹5.32 in March 2022 to ₹4.11 by September 2024, reflecting lower earnings per share for investors. 
• Return on Net Worth (RoNW): The RoNW has reduced from 22.29% to 11.37%, indicating a decrease in the company’s ability to generate returns on shareholder equity. 
• Financial Position: Total assets have increased, suggesting potential business growth. However, the current ratio has decreased, indicating weakening liquidity and potential challenges in meeting short-term obligations. 

Check out the other upcoming IPOs this month:

Newmalayalam Steel IPO Financial Analysis 

Newmalayalam Steel Limited IPO Peer Comparison 

Newmalayalam Steel Limited has a relatively lower market value, while Apollo Pipes Limited leads in size, profitability, and valuation. Hariom Pipe Industries exhibits solid growth, with a strong profitability and valuation metrics performance. 

Newmalayalam Steel Ltd IPO Objective 

The main objective of Newmalayalam Steel Limited is to enhance manufacturing capabilities through technological upgrades, expand solar power generation, build a new facility, strengthen marketing, and support working capital requirements for growth. 

1. IT / Technological Upgradation of existing manufacturing facility: The company intends to use INR 2.88 crores from the issue’s net proceeds to invest in IT equipment and storage, enhance inventory management, and upgrade manufacturing processes in Kerala. 

2. Expansion of the existing solar facility for power generation: The company plans to utilise INR 2.34 crores from the net proceeds to expand its solar facility, ensure an uninterrupted power supply, and enhance operational efficiency through a vendor partnership with Kirloskar Solar. 

3. Funding of expenditure towards civil construction of new factory shed cum storage facility within the existing factory premises situated at Kerala: The company aims to utilise INR 1.59 crores for constructing a factory shed cum storage facility, including steel building fabrication, crane beam installation, roof and wall sheeting, and necessary materials for factory construction. 

4. Advertising, Marketing, and Brand Building: The company will utilise INR 5.05 crores for advertising, marketing, and branding through Home Advertising, covering major cities in India, particularly Kerala. Darwin Platform Mass Media Limited will handle the campaign. 

5. Funding the company’s incremental working capital requirements  The company will utilise INR 14.20 crores from the net proceeds to fund its working capital requirements for Fiscal 2025, supporting business growth and profitability and achieving proposed targets as per the business plan. 

6. General Corporate Purposes: The company will deploy the balance of funds for general corporate purposes, including meeting ongoing contingencies, strengthening marketing capabilities, enhancing technology infrastructure, strategic initiatives, acquisitions, and funding any shortfall in the objectives above. 

Newmalayalam Steel IPO Risks And Challenges 

Newmalayalam Steel Limited’s risk includes supply disruptions of pre-galvanized coils, reliance on Promoter Group entities without formal agreements, and vulnerability to local economic, political, and regulatory conditions in Kerala, which may impact operations and financials. 

• The company’s steel manufacturing operations depend on a stable supply of pre-galvanized coils sourced domestically and internationally. Supply, quality, or price fluctuations may adversely impact production, costs, delivery cycles, and customer relationships. 

• The company sells products to and procures raw materials from its Promoter Group entities, Jaihind Steel Private Limited and Jaihind Tubes Private Limited. A lack of formal agreements could impact supply, quality, and business continuity, affecting operations and financials. 

• Local economic, political, and regulatory conditions impact the company’s operations in Kerala. Disruptions like natural disasters, social unrest, or industrial accidents could affect manufacturing, leading to operational, financial, and strategic challenges. 

Newmalayalam Steel Ltd IPO – Industry & Market Potential 

Global steel exports reached 259 MT in CY21, with China maintaining its position as the largest exporter. India’s steel exports rebounded after the November 2022 export duty reversal, signalling a trade recovery. 

India is the second-largest steel producer and consumer globally, with a CAGR of 2.8% in steel production and 5.5% in consumption over the last decade. The sector’s growth is driven by construction, automobiles, and infrastructure demand. 

India’s solar energy market, growing at a 29% CAGR, is projected to reach USD 238 billion by 2030. This growth will increase demand for solar structural pipes, creating substantial supplier opportunities in the coming years. 

Newmalayalam Steel Limited IPO – Type of Offer 

Newmalayalam Steel Limited is coming up with an IPO with a fresh issue of 46,40,000 shares worth INR 41.76 crores. The company aims to upgrade technology, expand facilities, fund growth, and enhance brand presence. 

Newmalayalam Steel IPO Offer Size 

The offer size of Newmalayalam Steel Limited is INR 41.76 crores, consisting of a fresh issue of 46,40,000 shares. The company aims to upgrade technology, expand facilities, fund growth, and enhance brand presence. 

Newmalayalam Steel Limited IPO Allotment Structure 

Newmalayalam Steel Limited’s allocation will be as follows: 10.02% for Qualified Institutional Buyers (QIB), 44.95% for Non-Institutional Investors (NII), and 45.03% for Retail Individual Investors (RII) according to SEBI regulations. 2,33,600 shares are reserved for market makers. 

● Qualified Institutional Buyers (QIB): As per SEBI regulations, 10.02% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers. These include entities such as banks, mutual funds, and insurance companies.

● Non-Institutional Investors (NII): 44.95% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs.2 lakhs.

● Retail Individual Investors (RII): The remaining 45.03% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs.2 lakhs. 

● Market Maker Reservation: A portion of shares, i.e. 2,33,600 shares, are reserved for market makers. 

How to apply for Newmalayalam Steel IPO?

To apply for the Newmalayalam Steel Limited IPO through Alice Blue, follow these steps:

Open a Demat and Trading Account: If you don’t have one already, you must open a Demat and trading account with Alice Blue.

1. Check for IPO Details: Once your account is active, you can check for the Newmalayalam Steel Limited IPO details in the IPO section of the Alice Blue platform.
2. Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.
3. Submit the Application: Confirm all your details and submit your application.

 You can apply for the Newmalayalam Steel Limited IPO at Alice Blue in just a few clicks!

Check Allotment Status: After the allotment process, you can check the allotment status to see if you have received any shares.

Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How do you check Newmalayalam Steel IPO Allotment Status?

Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:

1. Log in to your Alice Blue Account: You can do this through the Alice Blue website or the trading app.
2. Navigate to the Portfolio or IPO Section: This might differ based on the layout of Alice Blue’s platform, but generally, you can find the status of your IPO application under the ‘Portfolio’ or ‘IPO’ section.
3. Find the IPO Allotment Status: Look for a sub-section called ‘IPO Allotment Status’ or something similar. This is where you can see the status of the IPOs you have applied for.
4. Select the Newmalayalam Steel Limited IPO: If you have applied for multiple IPOs, there might be a dropdown menu or a list where you can select the IPO you are interested in. Select the Newmalayalam Steel Limited IPO.
5. Check the Status: The status of your application should be displayed here. If the shares have been allocated to you, it would be mentioned here.

 If you face any issues, we request you to reach out to our customer support team at Alice Blue for detailed assistance. 

 Apart from Alice Blue, there are other ways to check the allotment status of the Newmalayalam Steel Limited IPO:

● Registrar’s Website: Visit the website of KFin Technologies Limited, the registrar of the Newmalayalam Steel Limited IPO. On the homepage, look for the ‘IPO Allotment Status’ option. You must enter your PAN, application, or Demat account number to check your allotment status. Click on the ‘Submit’ button to view your IPO allotment status.

● NSE SME: You can also check the allotment status on the official websites of the National Stock Exchange (NSE) Small Medium Exchange (SME). You would need your application number and PAN to check the status. 

Please note that the allotment status will only be available after completing the allotment process, a few days after the IPO window closes.

Newmalayalam Steel Ltd IPO Offer Registrar

The registrar for the Newmalayalam Steel Limited IPO is KFin Technologies Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.

Contact information for the registrar: 

KFin Technologies Limited

Selenium Tower B, Plot No.31-32,

Gachibowli, Financial District,

Nanakramguda, Serilingampally,

Hyderabad – 500 032,

Telangana, India.

Telephone: +91 406 716 2222

Email: [email protected]

Website: www.kfintech.com 

Newmalayalam Steel IPO – FAQs