Subam Papers Limited is coming up with an IPO with a fresh issue of 61,64,800 shares worth INR 93.70 crores. The company aims to invest in a subsidiary for capital expenditure, and fund for general corporate purposes.

Subam Papers IPO – Important Dates

Read more about Subam Papers IPO GMP

Subam Papers Limited IPO  – Company Profile

The company is engaged in the manufacturing of Kraft Paper and Paper Products. They proudly call themselves a packaging solution-providing company. Subam started its journey in the year 2004 with the manufacturing of paper cones and later expanded the product base by adding Duplex board and Kraft paper to its portfolio.

The company is not like the traditional paper manufacturers, they do not manufacture their products from wood pulp but instead, they use waste paper as the raw material. The company aims to preserve mother nature and tends to drive the company on the principle of recycling. 

To further minimize the environmental impact, the company harnesses renewable energy through its own wind and solar power installations. The wind energy infrastructure includes two windmills: with a capacity of 850 KW each totalling approximately 1.7 MW. Additionally, they operate a solar plant with a capacity of 14 MW.

Subam Papers Ltd IPO Fundamental Analysis 

Subam Papers faced a challenging year in 2023 with losses, but its recovery in 2024 with a return to profitability, a stronger RoNW, and improved NAV per share indicates resilience. The manageable debt levels and increased asset base further support a positive outlook.

Revenue and Expenses:

• The company’s revenue increased from ₹32,927.45 lakhs in 2022 to ₹50,829.89 lakhs in 2023 but dropped slightly to ₹49,386.46 lakhs in 2024, indicating some fluctuation in sales.
• Expenses rose from ₹29,791.98 lakhs in 2022 to ₹50,566.01 lakhs in 2023, and then decreased to ₹45,117.35 lakhs in 2024, reflecting better cost control in 2024 despite the drop in revenue.

Profit and EPS:

• Profit after tax saw a loss of ₹68.35 lakhs in 2023, but rebounded strongly to ₹3,302.69 lakhs in 2024, indicating a significant recovery.
• Diluted EPS followed a similar pattern, from ₹15.98 in 2022 to a negative figure in 2023 but recovered to ₹20.53 in 2024, suggesting stronger profitability for shareholders.

Return on Net Worth (RoNW):

• RoNW dropped to -0.16% in 2023, reflecting a poor performance, but improved to 16.79% in 2024, showing the company’s return to generating value from its equity base.

Net Asset Value (NAV):

• NAV per share remained steady around ₹101-102 in 2022 and 2023 but increased to ₹122.29 in 2024, indicating growth in shareholder equity.

Assets and Liabilities:

• Total assets increased steadily from ₹39,418.33 lakhs in 2022 to ₹46,046.10 lakhs in 2024, signifying an expansion in the company’s asset base.
• Liabilities also rose from ₹22,829.22 lakhs to ₹26,141.98 lakhs during the same period, indicating increased leverage but within manageable levels, as seen in the stable debt-to-equity ratio.

Debt and Current Ratio:

• The debt-equity ratio remained stable, around 0.9 across all years, showing balanced financial leverage.
• The current ratio, however, declined from 1.51 in 2022 to 1.21 in 2024, indicating a tighter liquidity position, though still above 1, meaning short-term obligations can be met.

Subam Papers  IPO Financial Analysis

Subam Papers Limited IPO Peer Comparison

Subam Papers Limited, Pakka Limited, and Shree Ajit Pulp and Paper Limited exhibit varied financial metrics. Subam leads in revenue with ₹49,386.46 lakhs and a strong EPS of 20.53, while Shree Ajit boasts the highest NAV at ₹302.68 and Pakka has a notable P/E ratio of 22.36.

Subam Papers Ltd IPO Objective

The main objective of Subam Papers’ IPO is to invest INR 75 crores in its subsidiary, Subam Paper & Boards Private Limited, to finance its capital expenditure and expand its manufacturing facilities in Tirunelveli, Tamil Nadu. The remaining funds will be allocated towards general corporate purposes, including operational expenses, project development, business development, and handling unforeseen operational challenges.

1. To invest in a subsidiary for financing its capital expenditure: The company proposes to invest a sum of INR 75.00 crores in its subsidiary, viz., Subam Paper & Boards Private Limited by acquiring shares. As an anticipated plan of expansion of the subsidiary and to expand their manufacturing facilities to cater to the increased demand, they are in the process of setting up a new manufacturing facility in Tirunelveli, Tamil Nadu.

2. General Corporate Purpose: The company will deploy the balance of funds for general corporate purposes, including meeting operating expenses and initial development costs for various projects, strengthening business development and marketing capabilities, and addressing unforeseen exigencies in ordinary operations. 

Subam Papers IPO Risks And Challenges

Subam Papers faces litigation risks, including past NCLT proceedings, and relies heavily on Kraft and Duplex Paper for revenue. Failure to adapt to product changes or maintain quality could impact growth, revenue, and operations.

1. The company has certain outstanding litigation against it, an adverse outcome of which may adversely affect the business, reputation, and results of operations.

2. The Company has been referred to the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code, 2016. The issue was amicably settled and the said operational creditor withdrew the petition on October 06, 2022, and as of now, there are no ongoing NCLT cases against the company. However, they cannot guarantee that they will not face similar proceedings in the future.

3. The majority of the revenue is dependent on two products i.e., Kraft Paper and Duplex Paper, if the company is unable to anticipate or adapt to the evolving upgradation of products or inability to ensure product quality or reduction in the demand for such products may adversely impact the revenue from operations and growth prospects.

Subam Papers Ltd IPO – Industry & Market Potential

Packaging currently stands as the fifth largest sector in the Indian economy, reflecting its pivotal role in driving industrial growth and innovation. With an annual growth rate of 22-25%, the industry has become a preferred hub for packaging solutions, bolstered by advancements in technology and infrastructure. 

Notably, the industry boasts a robust structural framework, comprising over 900 paper units with an installed capacity of nearly 4,990 thousand tons. Furthermore, India is home to 861 paper mills, with 526 operational units, showcasing the nation’s significant capacity for paper and paperboard production.

Subam Papers Limited IPO – Type of Offer

Subam Papers Limited is launching an IPO with a fresh issue of 61,64,800 shares valued at INR 93.70 crores. The company plans to invest in its subsidiary for capital expenditure and allocate funds for general corporate purposes.

Subam Papers  IPO Offer Size

The offer size for Subam Papers Limited’s IPO is 61,64,800 shares worth INR 93.70 crores. The company intends to invest in a subsidiary for capital expenditure and allocate funds towards general corporate purposes.

Subam Papers  Limited IPO Allotment Structure

Subam Papers Limited’s allocation will be as follows: 50% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 35% for Retail Individual Investors (RII) according to SEBI regulations. 3,08,800 shares are reserved for market makers. 

● Qualified Institutional Buyers (QIB): As per SEBI regulations, 50% 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): 15% 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 35% 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. 3,08,800 shares, are reserved for market makers. 

Read more about Papers IPO Allotment Status

How to apply for the Subam Papers SME IPO?

To apply for the Subam Papers 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 Subam Papers 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 Subam Papers 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 Subam Papers 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 Subam Papers 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 Subam Papers 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 Subam Papers Limited IPO:

● Registrar’s Website: Visit the website of Bigshare Services Private Limited, the registrar of the Subam Papers 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.

 ● BSE SME: You can also check the allotment status on the official websites of the Bombay 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.

Subam Papers Ltd IPO Offer Registrar

The registrar for the Subam Papers Limited IPO is Bigshare Services Private Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.

Contact information for the registrar: 

Bigshare Services Private Limited

S6-2, 6th Floor, Pinnacle Business Park, 

Andheri (East) Mumbai – 400093.

Telephone: +91 22 6263 8200;

Email: [email protected]

Website: www.bigshareonline.com

 Subam Papers IPO  – FAQs