P S Raj Steels Ltd IPO

The IPO opens on 12 Feb 2025 & closes on 14 Feb 2025.

P S Raj Steels Limited was originally incorporated as P S Raj Steels Private Limited' as a Private Company on November 09, 2004 with the Registrar of Companies. Thereafter, the status of the Company converted into a Public Company to P S Raj Steels Limited' following a fresh Certificate of Incorporation on August 06, 2024 was issued by Registrar of Companies, Delhi and Haryana. The Company operate primarily in manufacturing Stainless Steel Pipes & Tubes. Key sectors include railways, furniture, households, gate railing, door frames, rice plants, sugar mills, food processing, heat exchanger etc. The Company commenced trading in stainless steel during the period 2005-06; it set up a manufacturing plant in Hisar district of Haryana and began construction work in 2006-07. It purchased 2 tube mills and other machines in establishing the production line in 2007-08. The Company further installed two new tube mills to the plant in 2010. It introduced two automatic polish machines in 2011 and resulting the production rose to approx. 1,411 MT in 2012. In 2015-16, the construction of manufacturing plant set-up already in 2006 at Hisar was completed with the installation of Slitting-line Machines. The Company created a milestone by constructing Building-3 in Hisar, which commissioned in 2019. The Company launched the IPO by allotting a fresh issue of 20,20,000 equity shares of Rs 10 each, by raising Rs 28.28 Cr in February, 2025.

P S Raj Steels Ltd IPO will close on 14 Feb 2025.

<ul><li>Strong, experienced and dedicated senior management team and qualified workforce.</li><li>Long term relationship with Jindal Stainless Limited.</li><li>Cost effective supply chain. </li><li>Ability to provide good quality services and customer satisfaction.</li><li>Ability to scout for new opportunities and capitalising the same.</li><li>Consistent track record of growth and financial performance.</li><li>Well known name in Stainless Steel Pipes & Tubes.</li><li>Geographical presence in more than 18 states of India.</li><li>Ability to serve diverse customer needs.</li></ul>

<table class="table"> <thead> <tr> <th>S.No</th> <th>Promoters Name</th> <th>Pre Issue Shares</th> <th>Pre Issue Percentage</th> <th>Post Issue Shares</th> <th>Post Issue Percentage</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Raj Kumar Gupta</td> <td>1076814</td> <td>19.51</td> <td>1076814</td> <td>14.28</td> </tr> <tr> <td>2</td> <td>Deepak Kumar</td> <td>550017</td> <td>9.97</td> <td>550017</td> <td>7.3</td> </tr> <tr> <td>3</td> <td>Gaurav Gupta</td> <td>597294</td> <td>10.82</td> <td>597294</td> <td>7.92</td> </tr> <tr> <td>4</td> <td>Vishal Gupta</td> <td>789480</td> <td>14.31</td> <td>789480</td> <td>10.47</td> </tr> <tr> <td>5</td> <td>Raj Kumar HUF</td> <td>591201</td> <td>10.71</td> <td>591201</td> <td>7.84</td> </tr> <tr> <td>6</td> <td>Deepak Kumar HUF</td> <td>490977</td> <td>8.9</td> <td>490977</td> <td>6.51</td> </tr> <tr> <td>7</td> <td>Gaurav Gupta HUF</td> <td>403506</td> <td>7.31</td> <td>403506</td> <td>5.35</td> </tr> <tr> <td>8</td> <td>Nikita Gupta</td> <td>222129</td> <td>4.03</td> <td>222129</td> <td>2.94</td> </tr> <tr> <td>9</td> <td>Punita Gupta</td> <td>249291</td> <td>4.52</td> <td>249291</td> <td>3.31</td> </tr> <tr> <td>10</td> <td>Jyoti Gupta</td> <td>275886</td> <td>5</td> <td>275886</td> <td>3.67</td> </tr> <tr> <td>11</td> <td>Vishal HUF</td> <td>271719</td> <td>4.92</td> <td>271719</td> <td>3.61</td> </tr> </tbody> </table>

<ul><li>The Company's sale from trading is expected to decrease in F.Y. 2025 due to decrease in sales to group entity.</li><li>The part of the revenue earned by the Company is from the Related Parties/ Group Entities. The loss of any of them may affect the revenue of the Company negatively.</li><li>Its business is largely concentrated in four states ("States") and is affected by various factors associated with these states.</li><li>The Company has reported certain negative cash flows from its investing activities and financing activities, details of which are given below. Sustained negative cash flow could impact its growth and business. </li><li>The company source approximately 95% of its raw material requirement from a single supplier, Jindal Stainless Limited ("JSL"). Cancellation or any delay by JSL or any disruption/ strike/ lock- outs in their business operation could have a material adverse effect on its business, production, sales and financial condition. </li><li>The company does not have any long-term agreements with Jindal Stainless Limited, its key supplier, for the continuous supply of raw material. Absence of such agreements leaves it vulnerable to sudden disruptions in supply, potential price increases, or unfavourable adjustments to supply terms, all of which could adversely affect its production schedules and financial stability. </li><li>Its cost of production is exposed to fluctuations in the prices of raw material particularly HR Coil and CR Coil. Fluctuations in the prices of these raw materials can have a significant impact on its production costs and overall financial performance.</li><li>The Company is dependent on few numbers of customers. Any loss of top 10 customers will significantly affect its revenues and profitability.</li><li>The company does not have long-term agreements with any of its customers, the loss of one or more of them or a reduction in their demand for the company products could adversely affect its business, results of operations, financial condition and cash flows.</li><li>The Company, its Promoters/ Directors and the company Group Entities are parties to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.</li><li>The company has in the past entered into related party transactions and may continue to do so in the future, which may potentially involve conflicts of interest with the equity shareholders. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on its financial condition and results of operations.</li><li>Its business is working capital intensive. If the company experience insufficient cash flows to meet required payments on its working capital requirements, there may be an adverse effect on the results of its operations.</li><li>Trade Receivables and Inventories form a substantial part of its current assets. Failures to manage the same could have an adverse effect on its net sales, profitability, cash flow and liquidity. </li><li>The company failures to accurately forecast and manage inventory could result in an unexpected shortfall and/ or surplus of raw materials, equipment and manpower, which could affect its business and financial condition.</li><li>Some of its borrowings carry restrictive covenants or conditions and could affect the company ability to manage its business operations.</li><li>There are certain instances of delays in payment of statutory dues by it. Any further delays in payment of statutory dues may attract financial penalties from the respective government authorities and in turn may have a material adverse impact on its financial condition and cash flows.</li><li>In its audited financial statements for the financial year 2022-23 and 2021-22, the Company did not make any provision for gratuity payment as required under The Payment of Gratuity Act 1972. However, in the Restated Financial Statements, the impact of provision for gratuity payment on the Profits earned by the company has been shown in Annexure-6 "Restated Summary Statement of Reconciliation of Restated Profit/(Loss) To Profit/ (Loss) as per Audited Financial Statements".</li><li>Its Promoters, Directors and Promoter group have provided personal guarantees for the company borrowings to secure its loans. Its business, financial condition, results of operations, cash flows and prospects may be adversely affected by the revocation of all or any of the personal guarantees provided by its Promoters, Directors and Promoter Group in connection with the Company's borrowings. </li><li>Majority of the independent directors does not have qualification related to the business of the company.</li><li>In addition to normal remuneration, other benefits and reimbursement of expenses of some of its Directors (including the company Promoters) and Key Management Personnel are interested in the Company to the extent of their shareholding and dividend entitlement in the Company. </li><li>Any variation in the utilisation of the Net Proceeds of the Fresh Issue as disclosed in this Red Herring Prospectus shall be subject to certain compliance requirements, including prior Shareholders' approval.</li><li>Compliance with, and changes in, safety, health and environmental laws and various labour, workplace related laws and regulations, including terms of the approvals granted to it, may increase its compliance costs and as such adversely affect the company business, prospects, results of operations and financial condition.</li><li>The pricing in the steel industry is subject to market demand, volatility and economic conditions. Fluctuations in steel prices may have a material adverse impact on its business, results of operations, prospects and financial conditions.</li><li>The company depends on the steel industry and a decrease in demand & steel prices may have a material adverse effect on its business, results of operations, prospects and financial condition.</li><li>Its manufacturing process requires the company labourers to work under potentially dangerous circumstances. In the event of any accidents, the Company may be held liable for damages and penalties which may impact the financials of the Company.</li><li>The average cost of acquisition of Equity Shares by its Promoters is lower than the floor price. </li><li>The company is exposed to the risks of malfunctions or disruptions of information technology systems that will affect its inventory management, cost & financial results of the Company. </li><li>A slowdown or shutdown in its manufacturing operations could have an adverse effect on the company business, results of operations, financial condition and cash flows.</li><li>The company is required to obtain consents under certain environmental laws, which are critical for operating its Manufacturing Facility.</li><li>Its may receive customer complaints and as a result may face product recalls, product liability claims and legal proceedings, if the quality of its Products does not meet the company customers' expectations, in which case its business and revenues, and ultimately the company reputation, could be negatively affected.</li><li>A shortage or unavailability of electricity or water could affect its manufacturing operations and have an adverse effect on its business, results of operations and financial condition. </li><li>If the company is unable to establish and maintain an effective internal controls and compliance system, its business and reputation could be adversely affected.</li><li>Employee misconduct, errors or fraud could expose it to business risks or losses that could adversely affect its business prospects, results of operations and financial condition. </li><li>Its funding requirements and deployment of the Net Proceeds of Fresh Issue are based on management estimates and have not been independently appraised by any bank or financial institution.</li><li>Any failures to protect or enforce its rights to own or use the company trademark could have an adverse effect on its business and competitive position.</li><li>Its Promoters and Promoters Group will continue to exercise control post completion of the Issue and will have considerable influence over the outcome of matters.</li><li>The company benefit from its relationship with some of its individual Promoters and the company business and growth prospects may decline if its cannot benefit from this relationship in the future. </li><li>The company insurance coverage may not be sufficient or may not adequately protect it against any or all hazards, which may adversely affect its business, results of operations and financial condition.</li><li>There is no guarantee that its Equity Shares will be listed on the Emerge Platform of NSE in a timely manner or at all.</li><li>In the event there is any delay in the completion of the Issue, there would be a corresponding delay in the schedule of implementation of this Issue which would in turn affect its revenues and results of operations.</li><li>The requirements of being a listed company may strain its resources.</li><li>Pursuant to listing of the Equity shares, its may be subject to pre-emptive surveillance measures like additional Surveillance Measures ("ASM") and Graded surveillance Measures ("GSM") by the Stock Exchanges in the order to enhance market integrity and safeguard the interest of the investors.</li><li>If there is any change in tax laws or regulations, or their interpretation, such changes may significantly affect its financial statements for the current and future years, which may have a material adverse effect on its financial position, business and results of operations.</li><li>Its ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures and there can be no assurance that the company will be able to pay dividends in the future.</li><li>Political, economic or other factors that are beyond its control may have an adverse effect on the company business and results of operations.</li><li>Changing laws, rules, regulations and legal uncertainties, including adverse application of corporate and tax laws, may adversely affect its business, results of operations and prospects. </li><li>Its may be affected by competition law in India and any adverse application or interpretation of the Competition Act could in turn adversely affect its business.</li><li>The occurrence of natural or man-made disasters could adversely affect its results of operations, cash flows and financial condition. Hostilities, terrorist attacks, civil unrest and other acts of violence could adversely affect the financial markets and its business.</li><li>Under Indian law, foreign investors are subject to investment restrictions that limit its ability to attract foreign investors, which may adversely affect the trading price of the Equity Shares.</li><li>Significant differences exist between Indian Accounting Standards ("Ind AS") and other accounting principles, such as the Generally accepted accounting principles of the United States of America ("US GAAP") and the International Financial Reporting Standards ("IFRS"), which may be material to investors' assessments of its financial condition.</li><li>Rights of shareholders under Indian laws may differ to those under the laws of other jurisdictions.</li><li>The Issue Price of the Equity Shares may not be indicative of the market price of the Equity Shares after the Issue.</li><li>The Equity Shares have never been publicly traded, and, after the Issue, the Equity Shares may experience price and volume fluctuations, and an active trading market for the Equity Shares may not develop.</li><li>Fluctuation in the exchange rate between the Indian Rupee and foreign currencies may have an adverse effect on the value of its Equity Shares, independent of the company operating results.</li><li>The Equity Shares subscribed in this Issue may not be able to be immediately sold on any Indian Stock Exchange.</li><li>There is no assurance that its Equity Shares shall remain listed on the stock exchange. </li><li>Any future issuance of Equity Shares, or convertible securities or other equity-linked securities by it may dilute your shareholding and the sale of Equity Shares by the Promoters may adversely affect the trading price of the Equity Shares.</li><li>Investors may be subject to Indian taxes arising out of capital gains on the sale of the Equity Shares.</li><li>Qualified Institutional Buyers and Non- Institutional Bidders are not permitted to withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after submitting a Bid and the Retail Individual Bidders are not permitted to withdraw their Bids after the Bid/ Issue Closing Date.</li></ul>

The Issue type of P S Raj Steels Ltd is Book Building - SME.

The minimum application for shares of P S Raj Steels Ltd is 1000.

The total shares issue of P S Raj Steels Ltd is 2020000.

Initial public issue of up to 20,20,000 equity shares of face value of Rs. 10 each ("Equity Shares") of the company for cash at a price of Rs. 140 per equity share (including a share premium of Rs. 130 per equity share) ("Issue Price") aggregating up to Rs. 28.28 crores ("Issue / Offer"). This issue includes a reservation of up to 1,01,000* equity shares aggregating up to Rs. 1.41 crores for subscription by market maker ("Market Maker Reservation Portion") and a reservation of up to 20,000* equity shares (constituting up to [*]% of the post-issue paid-up equity share capital of the company) aggregating up to Rs. [*] crores for subscription by eligible employees (as defined hereinafter) (the "Employee Reservation Portion"). The issue less the market maker reservation portion and employee reservation portion is hereinafter referred to as the "Net Issue". The issue and the net issue shall constitute [*]% and [*]%, respectively, of the post-issue paid-up equity share capital of the company, respectively. Price Band: Rs. 140 per equity share of face value of Rs. 10 each. The Floor price is 14 times the face value of the equity shares respectively. Bids can be made for a minimum of 1000 equity shares and in multiple of 1000 equity shares thereafter.