As an investor, it can be very challenging to decide whether the Rajputana Stainless IPO is a good or bad investment. Not anymore, as in this blog, we will provide you with all the necessary details related to the Rajputana Stainless IPO to help you decide whether you should Apply or Not. Read on to know the IPO risks, strengths, valuation, financial details, and expert opinion to make your investment decision better.
Strengths:
- The firm has a diversified portfolio of offering 80+ stainless steel grades.
- With over 30 years of experience in the Metals & Steel industry, the firm has established a strong customer base and relationships.
- Over the last 5 years, the company has generated a profit growth of 55.6% CAGR.
- Over 3 years, Rajputana Stainless generated a good return on equity (ROE) of 33.0%.
Weaknesses:
- The firm generates around 44% of its revenue from the top 10 customers, and they does not have a long-term contract with them. Losing any of these customers can adversely impact the business, cash flow, and financial condition.
- The company is dependent on its top 10 suppliers for its raw materials. Any delays, shortages, or failures to supply the raw materials on time can negatively impact the business and its operations.
- The company has contingent liabilities of ₹12,082.46 lakhs, which is 68.40% of its net worth. If the firm has to pay those liabilities in the future can impact the company’s financial condition.
- For the six months ended of september 30, the firm has reported a negative cash flow of â‚ą23.24 crores.
Rajputana Stainless IPO Review
| Reviewer | Recommendation |
| IPO Watch | Neutral |
| Canara Bank | |
| DRChoksey FinServ | |
| Emkay Global | |
| Hem Securities | |
| IDBI Capital | |
| Marwadi Shares | |
| Nirmal Bang | |
| SBICAP Securities | |
| Sharekhan | |
| SMC Global | |
| Sushil Finance | |
| Swastika Investmart | |
| Ventura Securities | |
| Geojit | |
| Reliance Securities | |
| Capital Market | |
| BP Wealth | |
| ICICIdirect | |
| Choice Broking |
Promoters & Track Records, if any
- Shankarlal Deepchand Mehta, aged 54 years, is the Chairman and Managing Director of the Company. He holds 3,77,46,748 of Equity shares, representing 54.77% of paid-up capital.
- Babulal D. Mehta, aged 67 years, is the Whole-time Director of the Company. He holds 61,62,050 equity shares, representing 8.94% of paid-up capital.
- Jayesh Natvarlal Pithva, aged 58 years, is the Executive Director of the Company. He holds 49,66,914 equity shares, representing 7.21% of paid-up capital.
- Yashkumar Shankarlal Mehta, aged 30 years, is the Chief Executive Officer of the Company.
Peer Comparison with the Company
| Name of the Company | Face Value(â‚ą) | EPS Basic(â‚ą) | EPS Diluted | RONW (%) | P/E Ratio | NAV(â‚ą) |
| Rajputana Stainless | 10 | 5.78 | 5.78 | 26.23% | 21.1 | 22.05 |
| Mangalam Worldwide Ltd | 10 | 10.59 | 10.59 | 11.28% | 22.57 | 91.37 |
| Mukand Ltd | 10 | 5.24 | 5.24 | 7.99% | 26.34 | 65.72 |
| Electrotherm Ltd | 10 | 347.06 | 347.06 | -278.47% | 3.16 | -124.60 |
| Panchmahal Steel Ltd | 10 | 1.74 | 1.74 | 1.74 | 182.18 | 84.02 |
Industry Peer Group P/E ratio
The industry peer group P/E ratio ranges from a low of 3.16 times for Electrotherm Limited to a high of 182.18 times for Panchmahal Steel Limited, with an average P/E ratio of 58.56 times.
Expansion
- The Proceeds of â‚ą18.57 crore raised from the fresh issue will be used towards setting up a manufacturing facility for Stainless Steel Seamless Pipes to expand the product portfolio
- Funds of â‚ą98 crore will be used for repayment and/or prepayment of certain outstanding borrowings taken by the company.
- Lastly, the remaining funds will be used for general corporate purposes.
Rajputana Stainless IPO—Should You Apply or Not?
A leading company that makes stainless steel products, Rajputana Stainless, is stepping into the primary market with its IPO open for subscription from the 9th of march onwards. The firm manufactures over 80+ grades of stainless products, which are used in the construction, engineering, and automotive sectors.
The firm operates its business in the B2B segments. India’s infrastructure projects are constantly growing, in railway and airlines, meaning the demand for stainless steel will be constantly growing as well, which benefits the company from rising industry demand and growth opportunities.
Financially, the PAT has grown to 66% over the last two years. In FY25, the company reported a constant revenue of ₹937.49 crore, while its EBITDA margin increased to 9.16% in H1 FY26. However, we saw a decline in cash flow of 77% in FY25. In terms of its valuations, on the upper-price band, the P/E ratio of Rajputana Stainless is 21.1x. When compared to the industry’s average P/E, the Rajputana is fairly priced. As of March 7, the Rajputana Stainless IPO GMP is ₹0. We recommend investors keep a close look at GMP. If it stays in support, then investors can subscribe for the IPO for short-term gains.
Overall, Rajputana Stainless features strong financials, experienced promoters, reasonable valuations, and moderate but improving margins that support future growth. However, high geographic concentration, pending tax proceedings, and negative cash flow are key concerns to watch out for.
Please note:
Investors are advised to make their own decisions and apply entirely at their own risk. This article is written using information from the company’s RHP (Red Herring Prospectus) data and online sources. If you have any queries, kindly contact the IPO Watch Team.
