Royalarc Electrodes IPO is scheduled to open for subscription on February 14, 2025, and will close on February 18, 2025. This IPO is a Book Built Issue, aiming to raise approximately ₹36.00 crores. The offering consists of a fresh issue worth ₹21.60 crores and an offer for sale (OFS) of 12,00,000 equity shares, each with a face value of ₹10.
Investors can apply for shares within the price band of ₹114 to ₹120 per share. The allotment process is expected to be finalized on February 19, 2025, with the company’s listing on NSE SME scheduled for February 21, 2025.
Financially, Royalarc Electrodes IPO has shown steady growth. In the fiscal year 2024, the company reported a revenue of ₹100.99 crores, reflecting an increase from ₹98.03 crores in 2023. The net profit also rose to ₹11.93 crores in 2024, compared to ₹9.57 crores in the previous year. These positive financial indicators suggest a promising outlook, making the IPO attractive for long-term investors.
The IPO structure allocates 50% of the shares for Qualified Institutional Buyers (QIBs), 35% for retail investors, and 15% for High Net-worth Individuals (HNIs). Retail investors need to apply for a minimum lot size of 1,200 shares, which requires an investment of ₹1,36,800 at the lower end of the price band. However, to avoid issues arising from oversubscription, bidding at the cutoff price is recommended, bringing the investment to ₹1,44,000. HNI investors must subscribe to at least two lots (2,400 shares), amounting to ₹2,88,000.
Given its financial performance and growth trajectory, Royalarc Electrodes IPO presents a viable investment opportunity. Investors looking for potential long-term returns may find this offering attractive, especially considering the steady increase in revenue and profitability.
Overview of Contents
Royalarc Electrodes IPO Overview
| Particulars | Details |
|---|---|
| Subscription Period | February 14, 2025 – February 18, 2025 |
| Listing Exchange | NSE SME |
| Face Value per Share | ₹10 |
| Price Band | ₹114 – ₹120 per share |
| Total Issue Size | 30,00,000 shares (₹36.00 Cr) |
| Fresh Issue | 18,00,000 shares (₹21.60 Cr) |
| Offer for Sale (OFS) | 12,00,000 shares (₹14.40 Cr) |
| Issue Structure | Book Built Issue |
| Retail Investor Quota | Up to 35% |
| Qualified Institutional Buyers (QIBs) | Up to 50% |
| Non-Institutional Investors (NIIs) | Up to 15% |
| Minimum Lot Size | 1,200 shares |
| Retail Investment (Min.) | ₹1,36,800 – ₹1,44,000 |
| HNI Minimum Investment | 2,400 shares (₹2,88,000) |
| Market Maker Allocation | 1,53,600 shares |
| Pre-Issue Shareholding | 93,00,200 shares |
| Post-Issue Shareholding | 1,11,00,200 shares |
| Tentative Listing Date | February 21, 2025 |
| DRHP | Click here |
| RHP | Click here |
Royalarc Electrodes IPO Lot Size
| Investor Category | Minimum Lots | Total Shares | Investment Amount |
|---|---|---|---|
| Retail Investors (Min.) | 1 Lot | 1,200 Shares | ₹1,44,000 |
| Retail Investors (Max.) | 1 Lot | 1,200 Shares | ₹1,44,000 |
| High Net-Worth Individuals (HNI) (Min.) | 2 Lots | 2,400 Shares | ₹2,88,000 |
Royalarc Electrodes IPO Dates
| Event | Date |
|---|---|
| Opening Date for Subscription | Friday, February 14, 2025 |
| Closing Date for Subscription | Tuesday, February 18, 2025 |
| Finalization of Allotment | Wednesday, February 19, 2025 |
| Refund Processing Begins | Thursday, February 20, 2025 |
| Shares Credited to Demat Accounts | Thursday, February 20, 2025 |
| Expected Listing Date | Friday, February 21, 2025 |
| UPI Mandate Confirmation Deadline | 5 PM on February 18, 2025 |
Royalarc Electrodes IPO Promoter Holding
The company is backed by key promoters, including Bipin Sanghvi, Tarulata Sanghvi, Hardik Sanghvi, and Swagat Sanghvi, who have played a vital role in its growth.
| Shareholding Stage | Percentage |
|---|---|
| Before IPO (Pre-Issue) | 99.99% |
| After IPO (Post-Issue) | 72.96% |
About Royalarc Electrodes IPO
Founded in 1996, Royalarc Electrodes Limited is a leading manufacturer of welding consumables, including welding electrodes, flux-cored wire, and MIG/TIG wires. These products are widely used in industries such as railways, airports, refineries, shipyards, mining, telecom, and thermal power plants for welding tanks, boilers, heavy structures, beams, pipes, cylinders, and pressure vessels.
The company also trades ancillary products like electro slag, saw flux, welding flux-cored wire, TIG/MIG wires, and electro slag strip cladding. Operating from a state-of-the-art 269,198 sq. ft. facility in Zaroli, Umbergaon, Gujarat, the company utilizes high-quality raw materials such as copper-coated wire, MS strips, SS wire, nickel wire, and ferro alloy powder.
Royalarc Electrodes supplies standardized and customized products across domestic and international markets, exporting to 20+ countries with certifications from ABS, IBR, and BIS, ensuring quality compliance through NABL-accredited labs. The company’s competitive strengths lie in its strong domestic and global presence, long-standing client relationships across industries, consistent financial performance, and an experienced management team. As of December 31, 2024, Royalarc Electrodes employs 144 permanent staff, driving its expansion and market growth.
Royalarc Electrodes Limited – Financial Performance
| Financial Metrics | 30 Sep 2024 | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 |
|---|---|---|---|---|
| Total Revenue | ₹46.06 Cr | ₹100.99 Cr | ₹98.03 Cr | ₹64.82 Cr |
| Profit After Tax (PAT) | ₹3.18 Cr | ₹11.93 Cr | ₹9.57 Cr | ₹2.12 Cr |
| Net Worth | ₹45.45 Cr | ₹42.27 Cr | ₹30.35 Cr | ₹20.78 Cr |
| Reserves & Surplus | ₹36.15 Cr | ₹32.97 Cr | ₹28.53 Cr | ₹18.96 Cr |
| Total Assets | ₹55.69 Cr | ₹52.25 Cr | ₹43.85 Cr | ₹42.48 Cr |
| Total Borrowings | ₹2.02 Cr | ₹0.20 Cr | ₹1.42 Cr | ₹7.81 Cr |
Royalarc Electrodes IPO – Key Valuation Metrics (FY2024)
| Metric | Value |
|---|---|
| Earnings Per Share (EPS) | ₹12.82 (Basic) |
| Return on Equity (ROE) | 32.85% |
| Return on Capital Employed (ROCE) | 37.73% |
| EBITDA Margin | 18.16% |
| Profit After Tax (PAT) Margin | 11.95% |
| Return on Net Worth (RoNW) | 28.21% |
| Net Asset Value Per Share (NAV) | ₹45.45 |
| Debt-to-Equity Ratio | 0.00 |
| Price-to-Earnings (P/E) Ratio | N/A |
Objects of the Issue
- Funding towards the expansion of the manufacturing facility situated at Village Zaroli, Umbergaon Valsad, Gujarat, Bharat
- Funding the working capital requirements of the Company
- General corporate purposes
Peer Group Comparison
| Company | EPS | PE Ratio | RoNW % | NAV | Income |
|---|---|---|---|---|---|
| ESAB India Limited | 105.90 | 46.94 | 53.25 | 198.87 | – Cr. |
| Ador Welding Limited | 46.46 | 21.08 | 17.44 | 266.49 | – Cr. |
| Gee Limited | 4.95 | 29.17 | 6.29 | 78.61 | – Cr. |
| Rasi Electrodes Limited | 1.02 | 28.43 | 9.83 | 10.47 | – Cr. |
Royalarc Electrodes IPO Review
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Royalarc Electrodes IPO Registrar
KFin Technologies Limited
Phone: 04067162222, 04079611000
Email: rael.ipo@kfintech.com
Website: https://kosmic.kfintech.com/ipostatus/
IPO Lead Managers aka Merchant Bankers
- Fedex Securities Pvt Ltd
Company Address
Royalarc Electrodes Limited
72 B, Bombay Talkies Compound,
S.V. Road Malad West,
Mumbai, , 400064
Phone: +91 78880 00553
Email: cs@royalarc.in
Website: https://royalarc.in/
Royalarc Electrodes IPO FAQs
What is the IPO price band?
The price band is set at ₹114 to ₹120 per share.
What is the lot size for retail investors?
Retail investors must apply for a minimum of 1,200 shares, requiring an investment of ₹1,44,000.
When will the allotment be finalized?
The allotment is expected to be finalized on February 19, 2025.
On which exchange will the IPO be listed?
The IPO will be listed on NSE SME on February 21, 2025.
What is the fresh issue and offer for sale breakdown?
The IPO consists of a fresh issue of ₹21.60 crores and an offer for sale of 12,00,000 shares (₹14.40 crores).
What industries does Royalarc Electrodes serve?
The company supplies welding consumables to railways, refineries, shipyards, power plants, and infrastructure sectors.
Should investors apply for Royalarc Electrodes IPO?
Based on financials, long-term investors may consider applying due to steady revenue growth and strong industry presence.