Shree Tirupati Balajee Agro Trading Company files RHP, Rs 170 cr IPO to open on Sept 5

Shree Tirupati Balajee Agro Trading Company IPO

Madhya Pradesh-based Shree Tirupati Balajee Agro Trading Company has filed red herring prospectus (RHP) with the market regulator SEBI. It intends to raise Rs 169.65 crore through its initial public offering at the upper price band.

The public issue will open for subscription on September 5 and close on September 9, while the anchor book of the offer will be opened for a day on September 4.

The 2.04 crore equity shares' IPO is a combination of fresh issue of 1.47 crore equity shares worth Rs 122.42 crore and an offer-for-sale of 56.9 lakh shares worth Rs 47.23 crore by promoter Binod Kumar Agarwal.

Binod Kumar Agarwal owns 88.38 percent stake in the company, and the remaining 11.62 percent stake is held by public shareholders.

The price band for the book-built issue has been fixed at Rs 78-83 per share.

Half of the public issue has been reserved for qualified institutional buyers (QIB), 35 percent for retail investors and the remaining 15 percent for non-institutional investors. Investors can bid for a minimum of 180 equity shares and in multiples of 180 shares thereafter.

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Shree Tirupati Balajee Agro Trading Company manufactures flexible intermediate bulk containers (FIBCs) i.e. large flexible bags and other industrial packaging products. Its products are used by several industries such as chemicals, agrochemicals, food mining, waste disposal, agriculture, lubricants and edible oil.

With five manufacturing units, it operates business through subsidiaries Honourable Packaging (HPPL), Shree Tirupati Balajee FIBC (STBFL), and Jagannath Plastics (JPPL).

The flexible intermediate bulk containers maker will utilise Rs 52.27 crore out of the net fresh issue proceeds for repaying debt. Its total debt on consolidated basis was Rs 245.33 crore as of May 2024.

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Further, Rs 13.5 crore funds will be spent for incremental working capital requirements, Rs 10.74 crore for working capital requirements of its subsidiaries, and the remaining fresh issue money for general corporate purposes.

According to its RHP, FIBC segment contributed more than 51 percent to its revenue in the fiscal 2024, woven fabrics & narrow fabric business 21.3 percent to topline, while little more than 4 percent business come from woven sacks and tape divisions. Other products including liner, container liner, thread, multi-filament yarn, and filler cord etc accounted 18.5 percent of revenue.

Shree Tirupati Balajee Agro that compares with listed peers like Commercial Syn Bags, Emmbi Industries, and Rishi Techtex recorded net profit at Rs 36.1 crore for the fiscal 2024, growing 74.1 percent over the previous fiscal, backed by healthy operating performance and higher other income. Other expenses were also lowered to Rs 70.34 crore, from Rs 85.3 crore during the same period.

Revenue from operations in FY24 increased by 13.5 percent to Rs 539.7 crore compared to Rs 475.4 crore in the previous year FY23. On the operating front, EBITDA (earnings before interest, tax, depreciation and amortisation) grew by 29 percent on-year to Rs 61.9 crore with margin expanding by 137 bps to 11.47 percent for the year ended March 2024.

PNB Investment Services, and Unistone Capital are the book running lead managers to the issue, while Link Intime India is acting as the registrar to the offer.