Ratnaveer Precision Engineering receives SEBI green light to go ahead with IPO

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Gujarat-based stainless steel products manufacturer Ratnaveer Precision Engineering has received approval from the capital market regulator for fundraising through an initial public offering. It was the second public issue that received a go-ahead from the Securities and Exchange Board of Idia (SEBI) last week, after another Gujarat-based company, SPC Life Sciences.

The public issue of 1.74 crore equity shares of Ratnaveer comprises a fresh issue of 1.53 crore shares and an offer for sale of 21 lakh shares by promoter Vijay Ramanlal Sanghavi, as per the draft prospectus.

The company filed its draft red herring prospectus with the SEBI in January 2023 to seek approval for IPO.

The regulator issued its observations letter to the company on June 30, as per the update available with the SEBI on July 3. Generally, getting an observation letter is an intimation from the regulator to launch the initial public offering.

As per the IPO papers, the stainless steel pipe and tube maker will utilise its fresh issue proceeds for working capital requirements, besides general corporate purposes.

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Ratnaveer operates its business through four manufacturing units in Gujarat. The company manufactures finishing sheets, washers and solar mounting hooks at unit-I and SS pipes and tubes at unit-II. Unit-III and unit-IV are used for the backward integration process where the former is the melting unit and the latter is the rolling unit.

The domestic business contributed around 77 percent to its revenue and the rest is from exports.

On the financials front, the company reported a consolidated profit of Rs 9.5 crore for the financial year ended March 2022, rising 18.7 percent over the previous year, and the revenue in the same period grew by 74.6 percent to Rs 426.9 crore. For the five months ended August FY23, the profit stood at Rs 8.9 crore on revenue of Rs 169.5 crore.