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Upcoming IPO: Shyam Metalics and Energy Limited

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Everything you need to know about Shyam Metalics and Energy Limited’s upcoming IPO in 2021.

Incorporated in 2002, Shyam Metalics and Energy Limited (SMEL) is India’s leading integrated metal producer company. The company is primarily engaged in producing long steel products such as iron pellets, sponge iron, steel billets, TMT, structural products, wire rods, and ferroalloys. As of February 2021, it is among India’s largest producers of ferroalloys in terms of installed capacity and the fourth-largest player in the sponge iron industry.

About Shyam Metalics and Energy Limited

Kolkata-based Shyam Metalics is a metal producing company with a focus on long steel products and ferroalloys. The company has a diversified product mix such as iron pellets, sponge iron, steel billets, TMT, structural products, wire rods, and ferroalloys. It operates three manufacturing plants, one in Odisha (Sambalpur) and two in West Bengal (Jamuria and Mangalpur). As of Dec 31, 2020, its manufacturing units have an aggregated installed metal capacity of 5.71 million tonnes per annum. The company is looking to expand its capacity from 5.71 MTPA to 11.60 NTPA by 2025.

The company serves institutional customers and end-users. Jindal Stainless Limited, Rimjhim Ispat Limited are some of its domestic clients. In contrast, Norecom DMCC, Norecom Limited, POSCO International Corporation, World Metals & Alloys, Traxys North America LLC, JM Global Resources, Vijayshri Steel Pvt Ltd, etc. are the international clients. In addition, the company has a partnership with 42 distributors to offer its products across 13 states and one union territory.

Shyam Metalics and Energy Limited IPO Issue Details

OPENS ON: June 14, 2021
CLOSES ON: June 16, 2021
Price band: Rs. 303 – Rs.306 per share
Lot size: 45 shares
One lot costing: Rs. 13,770
Face Value: Rs. 10 per share
Listing on: NSE, BSE
Issue size: Rs. 909 cr (Fresh issue: Rs. 657 cr + Offer For Sale: Rs. 252 cr)
Shareholding: Promoter holding will stand at 88.35% post-issue from 100% pre-issue.

Will list on the exchange on June 24, 2021.

Objects of the issue:

  • Repayment and/or pre-payment of the company and its subsidiary (SSPL)’s debt fully or partially.
  • General corporate purposes.

Interesting facts about Shyam Metalics and Energy Limited IPO:

  • Considering the TTM(Dec 20) adjusted EPSof 21.02 on a post-issue basis, the company will list at PE of 14.6Xwith a market cap of Rs. 78,055 million, whereas its peers, namely Tata Steel and JSW Steel, are quoting at higher PE of 16.6X and 21.6X, respectively.
  • Shyam Metalics’ eight captive power plants, which account for around 90% of the total power units consumed, make it self-reliant and cost-effective. 
  • Revenues of Shyam Metalics rose 6.5 per cent compounded annually to Rs 4,362.89 crore in FY20 over Rs 3,842.57 the crore in FY18 (It fell in FY20). Revenues for the first nine months of FY21 rose 19.80 per cent to Rs 3,933.08 crore. 
  • As a part of its business strategy, the company proposes to continue to increase manufacturing capacities while focusing on exports and cost-efficiency.
  • Has integrated operations across the steel value chain.

Get the complete IPO subscription details of the Shyam  Metalics and Energy Ltd IPO in the MSFL Research Report and to apply, visit Marwadi Shares & Finance Ltd website.

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