IPO Details
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Schedule of A-One Steels India Ltd IPO
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End date
Allotment of bids
Refund Initiation
Listing on exchange
About A-One Steels Limited IPO
The IPO includes a fresh issue of equity shares with a face value of ₹10 each, aggregating up to ₹600 crores. Additionally, it involves an offer for sale of equity shares with a face value of ₹10 each, aggregating up to ₹50 crores. The total offer size amounts to equity shares aggregating up to ₹650 crores. The credit of shares to the demat account will take place on TBA. The basis of allotment will take place on TBA and the initiation of refunds will take place on TBA.
Objectives of A-One Steels Limited IPO
- Investing in its Indian subsidiary, Vanya Steels Private Limited, to buy equipment, machinery, and expand its manufacturing facility.
- Funding Vanya Steels Private Limited to set up a Group Captive solar power system for energy needs.
- Repaying or partially repaying some of the company’s existing loans.
- Covering general corporate expenses.
A-One Steels Limited IPO Valuation
Share Offer and Subscription Details
| Investor Category | Shares Offered |
|---|---|
QIBs | Not more than 50% of the net offer |
Non-institutional Investors (NIIs) | Not less than 15% of the net offer |
Retail-individual Investors (RIIs) | Not less than 35% of the net offer |
Industry Outlook
In Fiscal 2024, strong steel demand came from key sectors like building, construction, and infrastructure, which make up over 60% of domestic steel consumption. This was driven by increased government spending on infrastructure ahead of elections. From April to December 2023, capital expenditure surged by ~47% for roads and ~52% for railways compared to the previous year.
Steel demand from the automobile sector remained strong but grew at a slower pace due to a high base in Fiscal 2023. Passenger vehicle (PV) sales increased by 8.4%, while two-wheeler sales rose by 13.3%.
Steel demand is expected to slow down in Fiscal 2025 due to the high base of Fiscal 2024. Above-average monsoon rainfall (8% higher than the long-term average) and general elections in the first half of the year impacted construction activity, reducing steel demand. However, demand is expected to recover in the third and fourth quarters, leading to overall growth of 7-9% for the year.
From Fiscal 2025 to 2029, CRISIL MI&A Research forecasts steel demand to grow at a CAGR of 6-8%, driven by end-use industries, government spending, and capacity expansions by large steel producers.
Company Information
The company is a backward integrated steel manufacturer based in southern India, producing a diversified range of long and flat steel products, industrial products, and green energy-certified TMT bars. It manufactures HR coils, CR coils, ferro silicon, and met coke while also converting MS billets into pipes and tubes for domestic and industrial use.
A-One Steels India Ltd Strengths
Strategic location advantage
The company’s manufacturing facilities are strategically located within 100 kilometres of the mineral belt in Bellary and Koppal, ensuring proximity to raw material sources. This reduces transportation costs, improves logistics management, and enhances operating margins, enabling economies of scale and operational efficiencies.
Diverse product portfolio
As one of the top five steel producers in southern India, the company offers a wide range of long and flat steel products along with industrial items. Its diverse portfolio minimizes reliance on any single product, supporting consistent revenue generation across multiple categories.
Extensive distribution network
The company has a robust supply chain comprising over 80 authorised distributors and 700+ direct retail sales channels. It also serves 35+ institutional customers, leveraging its widespread network to boost brand awareness and expand its market presence.
Risks of A-One Steels Limited IPO
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Under-utilisation of manufacturing capacities: The company faces challenges in fully utilising its expanded manufacturing capacities, which could lead to operational inefficiencies. This may adversely impact its business performance, profitability, margins, and cash flows, especially if production remains below optimal levels despite increased installed capacities across facilities.
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Dependence on raw materials: An increase in the cost of or a shortfall in the availability of raw materials such as iron ore, coal and scrap from their suppliers due to various reasons could have a material adverse effect on their business, results of operations, cash flows and financial conditions.
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Dependence on raw material suppliers: The company relies heavily on third-party suppliers for key raw materials like iron ore, coal, and steel scrap. Any increase in costs or supply disruptions could significantly affect its operations, cash flows, and ability to maintain competitive pricing.
All Financial Information about A-One Steels India Ltd
Comparison with peers
| Name of Company | Total Income (₹ in crores) | EPS (basic) ₹ | NAV (₹ per share) | P/E |
|---|---|---|---|---|
A-One Steels India Limited | 3,862.43 | 6.64 | 72.80 | - |
MSP Steel and Power Limited | 2,912.26 | 0.37 | 13.99 | 132.00 |
Jai Balaji Industries Ltd. | 6,628.86 | 55.80 | 89.59 | 18.25 |
Shyam Metallics and Energy Ltd. | 13,354.20 | 39.54 | 395.63 | 18.67 |
Anchor Investor Bidding Date: TBA
Registrar: Bigshare Services Private Limited
Book Running Lead Managers: PL Capital Markets Private Limited and Khambatta Securities Limited
Business Model
The company operates as a backward-integrated steel manufacturer with a diversified product portfolio catering to both long and flat steel products, as well as industrial products used in steel manufacturing. It produces TMT bars, HR coils, CR coils, and industrial products like met coke and ferro silicon, leveraging captive consumption for efficiency while selling surplus in the open market. Additionally, the company emphasises green energy usage and has certified its TMT bars as eco-friendly products.
Company Growth Trajectory
The company's EBITDA decreased from ₹238.26 crores in FY23 to ₹198.69 crores in FY24, reflecting a decline of approximately 16.6%. This drop is primarily due to a reduction in the EBITDA margin, which fell from 7.53% in FY23 to 5.18% in FY24, and could indicate increased operational costs or reduced pricing power. Its profit after tax also declined from 10,065 crores in FY22 to ₹3891.37 crores in FY24.
Market Position
They are one of the top 5 (five) steel producers in southern Indi a in terms of crude steel capacity, and the only company manufacturing 10 steel products and industrial products. (Source: CRISIL Report). According to the CRISIL Report, the company had a share of 0.27% in overall crude steel production in India and has ~1% share, as per FY24 sales figure of ASIPL, in domestic pipe market. (Source: CRISIL Report).
A-One Steels Limited Profit and Loss
| Parameter | FY 24 (₹ crores) | FY 23 (₹ crores) | FY 22 (₹ crores) |
|---|---|---|---|
Total Income | 3,862.43 | 3,184.27 | 2,761.19 |
Profit Before Tax | 58.17 | 134.83 | 134.67 |
Profit After Tax | 38.91 | 97.69 | 100.65 |
EPS | 6.64 | 16.68 | 17.18 |
EBITDA | 198.69 | 238.26 | 184.21 |
A-One Steels Limited Balance Sheet
| Parameter | FY 24 (₹ crores) | FY 23 (₹ crores) | FY 22 (₹ crores) |
|---|---|---|---|
Profit Before Tax | 58.17 | 134.83 | 134.67 |
Net Cash from (used in) Operating Activities | 325.39 | (319.50) | (51.93) |
Net Cash from (used in) Investing Activities | (191.49) | (247.05) | (108.99) |
Net Cash from (used in) Financing Activities | (155.68) | 596.74 | 168.52 |
Net Cash and Cash Equivalents | (21.77) | 30.18 | 7.60 |
How to Check Allotment Status of A-One Steels Limited IPO?
1. Visit the Registrar's Website
To check the IPO allotment status for A-One Steels Limited IPO, visit the official website of Bigshare Services Private Limited, the registrar for this IPO. On their IPO allotment status page, enter your Permanent Account Number (PAN), application number, or Demat account ID. Then, click the ‘Submit’ button to view your allotment status. Ensure you have the necessary details ready for a quick and accurate check.
2. Check on the Bombay Stock Exchange Website
The Bombay Stock Exchange (BSE) also has an IPO allotment status page. Go to www.bseindia.com and find the 'Investors' tab. Under 'Investors', click on 'IPO'. This will take you to the IPO allotment status page.
On the BSE IPO page, follow these steps
- Select 'Equity' from the dropdown menu
- Choose 'A-One Steels Limited' in the next dropdown
- Enter your application number
- Enter your PAN
- Click 'Search'
Your A-One Steels IPO allotment status will be displayed.
3. Verify on the National Stock Exchange Website
The National Stock Exchange (NSE) has an IPO Bid Verification module. Use this to check A-One Steels IPO allotment status.
Go to www.nseindia.com and find the 'Invest' tab. Click on 'Verify IPO Bids' under 'Resources & Tools'. On the NSE IPO Bid Verification page, enter:
- Application number
- PAN
Then click 'Submit'. Your A-One Steels IPO bid and allotment details will be displayed.
How to Apply for A-One Steels Limited IPO?
- Step 1: Log in to your Kotak Securities Demat account - Log in to your Demat account to access IPO investments. Next, select the current IPO section.
- Step 2: Specify IPO details - Enter the number of lots and the price you wish to apply for.
- Step 3: Enter UPI ID - After entering your UPI ID, click submit. This will place your bid with the exchange.
- Step 4: Mandate Notification - Your UPI app will receive a mandate notification to block funds.
- Step 5: Approve Request - Your funds will be blocked once you approve the mandate request on your UPI.
This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI-prescribed Combined Risk Disclosure Document before investing. Brokerage will not exceed SEBI’s prescribed limit.
A-One Steels India Ltd IPO FAQs
What is the A-One Steels Ltd IPO?
The IPO comprises a fresh issue of ₹600 crores and an offer for sale of ₹50 crores, totalling ₹650 crores.
Is A-One Steels IPO coming?
Yes, A-One Steels Ltd is expected to come up with its IPO soon.
Who is the chairman of A-One Steels?
Sunil Jallan is the chairman of A-One Steels.
What is the lot size of shares of A-One Steels Ltd IPO?
The company hasn’t given any information on the lot size yet.
From where can I read more about the IPO of A-One Steels Ltd?
You may read more about A-One Steels and its IPO from the company’s draft red herring prospectus (DRHP) here.
