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23 March 2024

Vruddhi Engineering Works IPO

Vruddhi Engineering Works Limited has announced its Initial Public Offering (IPO) with a book-built issue aiming to raise Rs 4.76 crores through the fresh issuance of 6.8 lakh shares. This IPO provides an opportunity for investors to participate in the company's journey towards growth and expansion. Set within the price band of ₹66 to ₹70 per share, detailed information is structured in tables below for clarity and ease of understanding.

Vruddhi Engineering Works IPO Overview

IPO Details

Detail	Description
IPO Open Date	March 26, 2024
IPO Close Date	March 28, 2024
Listing Date	April 3, 2024 (Tentative)
Issue Type	Book Built Issue IPO
Price Band	₹66 to ₹70 per share
Lot Size	2000 Shares
Total Issue Size	680,000 shares (Aggregating up to ₹4.76 Cr)
Listing At	BSE SME
Book Running Lead Manager	Fedex Securities Pvt Ltd
Registrar	Bigshare Services Pvt Ltd

IPO Subscription Details

Category	Shares Offered	Percentage of Net Issue
QIB	Not more than 50.00% of the Net offer	-
Retail	Not less than 35.00% of the Offer	-
NII (HNI)	Not less than 15.00% of the Offer	-

IPO Timeline (Tentative Schedule)

Event	Date
IPO Open Date	March 26, 2024
IPO Close Date	March 28, 2024
Basis of Allotment	April 1, 2024
Initiation of Refunds	April 2, 2024
Credit of Shares to Demat	April 2, 2024
Listing Date	April 3, 2024

IPO Lot Size and Investment

Investor Type	Lots	Shares	Amount (₹)
QIB	Not more than 50.00% of the Net offer	2000	₹140,000
Retail	Not less than 35.00% of the Offer	2000	₹140,000
NII (HNI)	Not less than 15.00% of the Offer	2000	₹140,000

Company Overview

Vruddhi Engineering Works Limited, established in 2020, is known for providing mechanical splicing solutions to various industries. With a focus on the development, design, and supply of reinforcement couplers, the company caters to construction contractors, real estate developers, and infrastructure companies.

Financial Performance Snapshot

Period Ending	Assets (₹ Lakhs) R	Revenue (₹ Lakhs)	PAT (₹ Lakhs)
Sep 30, 2023	808.58	935.36	41.01
Mar 31, 2023	782.33	1,309.62	75.33

Key Performance Indicators

KPI	Value
Market Capitalization	Rs 17.67 C
ROE	16.20%
ROCE	15.53%
RoNW	0.1
PAT Margin (%)	4.38%

Objectives of the Issue

The net proceeds from the IPO are earmarked for the following purposes

1. To meet working capital requirements.
2. General corporate purposes.

Vruddhi Engineering Works IPO Review

Analyst Dilip Davda notes the company's recent financial performance improvement but advises caution due to the lack of own manufacturing units and reliance on third-party contracts. Considering the aggressive pricing based on FY24's annualized earnings and the small equity base post-IPO, potential investors are advised to evaluate the risks and consider their investment strategy carefully.

FAQs for Vruddhi Engineering Works IPO

What is the Vruddhi Engineering Works IPO?

Vruddhi Engineering Works IPO is a book-built issue aiming to raise Rs 4.76 crores through the issuance of 6.8 lakh shares, with a price band of ₹66 to ₹70 per share.
When is the Vruddhi Engineering Works IPO scheduled?

The IPO opens for subscription on March 26, 2024, and closes on March 28, 2024.
What is the listing date for the Vruddhi Engineering Works IPO?

The tentative listing date is April 3, 2024, on the BSE SME platform.
What is the price band for the Vruddhi Engineering Works IPO?

Each share was priced at ₹86.
What is the minimum lot size for the IPO?

The minimum lot size for this IPO is 2000 shares.
How much is the minimum investment required for the IPO?

The minimum investment required for retail investors is ₹140,000. For HNI investors, it's ₹280,000 for 2 lots (4,000 shares).
Who is the book running lead manager for the IPO?

Fedex Securities Pvt Ltd is the book running lead manager for the IPO.
Who is the registrar for the IPO?

Bigshare Services Pvt Ltd is the registrar for the IPO.
What are the main services of Vruddhi Engineering Works Limited?

Vruddhi Engineering Works Limited specializes in providing mechanical splicing solutions to the real estate, construction, and infrastructure industries through the development, design, and supply of reinforcement couplers.
What will the IPO proceeds be used for?

The IPO proceeds will be used for meeting working capital requirements and for general corporate purposes.
Where is Vruddhi Engineering Works Limited located?

The specific location details are provided in their Red Herring Prospectus (RHP), but the company operates in the mechanical splicing sector catering to various industries.
What is the financial performance of Vruddhi Engineering Works Limited?

As of September 30, 2023, Vruddhi Engineering Works Limited reported significant growth in revenue and profit after tax (PAT) compared to the previous fiscal year.
Is the Vruddhi Engineering Works IPO worth investing in?

Analyst Dilip Davda suggests caution due to the company's reliance on third-party contracts and the aggressive pricing based on FY24's annualized earnings. Potential investors are advised to carefully consider their investment strategy.