Friday, August 31, 2012

Thejo Engineering IPO

Thejo Engineering Limited, a Chennai based engineering solutions provider, is entering the capital markets with a public issue aggregating upto Rs 21 crore through a book building process. The company is an engineering solutions provider for bulk material handling, mineral processing and corrosion protection to the core sector industries like mining, power, steel, cement, ports, fertilizers etc. The company has four manufacturing units located near Chennai and pan India presence through 11 branch offices and 36 site offices located across 14 states. Its international presence through partnerships and distribution network extends across Australia, Kingdom of Saudi Arabia, the USA, Germany, Chile, Brazil and Ghana.

This is the first stock that is proposed to be listed on Emerge the SME platform by NSE.

The IPO shall open on 4 September, 2012 and shall close on 6 September, 2012. The price band has been fixed at Rs 402 to Rs 430 per equity share of Rs 10 each.

Thejo Engineering proposes to invest the net proceeds of the Issue to set up a poly-urethane unit with investment of Rs 68.28 lakh, expansion of the existing facility with an investment of Rs 6.87 crore, setting up R&D unit with a total outlay of Rs 2.83 crore and setting up a lining plant with a total cost of Rs 1.69 crore, all at Chennai. It also proposes to investment Rs 6.42 crore in Thejo Australia Pty Ltd., its Australian subsidiary. The company currently designs, manufactures and supplies wear and abrasion rubber products for the mineral processing industry in Australia and has incorporated Thejo Australia Pty Ltd, a subsidiary in Australia to enable it to enter the services business. This company will focus on offering belt conveyor related maintenance services and rubber lining activities, initially to clients in Western Australia. It is also keen to establish a branch/subsidiary in western Africa. It has secured certain orders for mill liners from mine(s) in Ghana and is exploring other such opportunities and intend to engage agents to market products under the THEJO brand in the Western African countries such as Ghana, Ivory Coast, Burkina Faso, Togo etc. The Company has entered into a joint venture with Hatcon LLC of Bahrain and intends to obtain a manufacturing license in the JV which will act as a base to cater to the entire GCC markets. Thejo has entered into an MOU with Tecnoflex Ind.Mec.Ltd with an objective of establishing a joint venture in Brazil for marketing of products and services from the combined product profile within Brazil, Argentina, Uruguay & Paraguay.

On a standalone basis, the company’s total revenue touched Rs 117.86 crore for the year ended March 31, 2012 as against Rs 96.20 crore in FY 2010-11 and Rs 65.96 crore for FY 2009-10. The profits after tax (PAT) for the corresponding periods was Rs 9.02 crore, Rs 3.83 crore and Rs 2.27 crore, respectively. Over FY09-10 to FY11-12, revenue has grown at a CAGR of 34% and EBIDTA at a CAGR of 46% In fiscal 2012, Thejo’s products and services contributed 53% and 43% of its total income respectively. Since the last two years it has initiated trading in certain manufactured products of international repute which supplements its current product line.

IDBI Capital Market Services Limited is the sole book running lead manager for the issue and Cameo Corporate Services Limited is the registrar to the Issue.  

Recommendation:


CRISIL has assigned grade 5 to IPO indicating that the fundamentals of the IPO are excellent as compared to other SMEs in India. Visit this post again for more recommendation!

Subscription:

Thejo Engineering IPO got subscribed by 1.5 times.

At the close of the IPO,
QII segment got fully subscribed
NII segment got 0.91 times subscribed
Retail segment got 2.61 times subscribed

Allotment:

Visit this post again for allotment status!

Listing:

Thejo Engineering IPO got listed on 18 September, 2012. The stock closed at the issue price of Rs 402 per share.


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