Dee Development Engineers – About the Company
Dee Development Engineers specializes in process piping solutions for industries like oil and gas, power, and chemicals. The company has over three decades of experience, which has helped them expand their business to include other products like high-pressure piping systems, piping spools, high-frequency induction pipe bends, industrial pipe fittings, etc.
In terms of installed capacity, the company is India's largest player in process piping solutions. They also specialize in handling complex metals like carbon steel, stainless steel, super duplex stainless steel, alloy steel, and other materials. The company has six strategically located manufacturing facilities in Palwal, Haryana, Anjar, Barmer, and Bangkok, with a cumulative installed capacity of 94,500 MT per annum as of fiscal 2023. The company has supplied its products to domestic and overseas customers in various countries, including the USA, Europe, Japan, Canada, the Middle East, Nigeria, Vietnam, Singapore, China, and Taiwan.
Dee Development Engineers IPO Objectives
The Issue comprises of both fresh and the offer for sale (OFS).
- The company will not receive any fund from the (OFS). The OFS comprises of up to 4,582,000 Equity Shares, aggregating up to Rs. 93.01 crores.
- The Fresh Issue comprises up to Rs. 325 crores and the net Proceeds will be utilised toward following objectives
-
- Working capital requirements
- Payment of outstanding borrowings availed by our Company / Subsidiaries
- General corporate purposes.
Dee Development Engineers IPO Details:
| IPO Open Date | June 19, 2024 |
| IPO Close Date | June 21, 2024 |
| Basis of Allotment | June 24, 2024 |
| Listing Date | June 26, 2024 |
| Face Value | Rs 10 per share |
| Price | Rs. 193 to Rs. Rs. 203 per share |
| Lot Size | 73 Shares |
| Total Issue Size | 20,591,852 shares |
| aggregating up to Rs. 418.01 Cr | |
| Fresh Issue | 16,009,852 shares |
| aggregating up to Rs. 325.00 Cr | |
| Offer For Sale | 4,582,000 shares |
| aggregating up to Rs. 93.01 Cr | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not more than 50% of the Net Issue |
| Retail Shares Offered | Not less than 35% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
Dee Development Engineers IPO Issue Price & Size
The issue price of Dee Development Engineers is between the price ranges of Rs 193 to Rs 203. The investors can bid between these price ranges during the open and close date of Dee Development Engineers IPO. As per the DRHP offer document, Dee Development Engineers IPO will issue a fresh issue of equity shares of up to Rs 325 crores and an offer-for-sale (OFS) of Rs. 93.01 crores.
Dee Development Engineers IPO Launch Date
The launch date of the Dee Development Engineers IPO is announced from June 19, 2024 till June 21, 2024. All types of investors can bid for the IPO between these dates. Basis of Allotment for Dee Development engineering IPO is announced for June 24, 2024.
Dee Development Engineers Financial Statements:
| Particulars | For the year ended March 31 | ||
| 2023 | 2022 | 2021 | |
| Revenue from contracts | 5954.95 | 4609.16 | 4952.17 |
| Other income | 188.25 | 99.23 | 178.09 |
| Total Income | 6143.2 | 4708.39 | 5130.26 |
| Cost of raw materials consumed | 2261 | 1948.97 | 1984.71 |
| Purchases of traded goods | 28.9 | 11.35 | 9.57 |
| inventories | -387.68 | -242.1 | 370.04 |
| Employee benefits expenses | 1109.47 | 792.98 | 739.63 |
| Finance costs | 299.02 | 253.37 | 271.29 |
| Depreciation and amortization expenses | 377.27 | 358.99 | 355.37 |
| Other expenses | 2251.5 | 1451.89 | 1311.38 |
| Total expenses | 5939.48 | 4575.45 | 5041.98 |
| Restated profit for the year | 129.72 | 81.97 | 142.05 |
| Basic EPS | 2.45 | 1.53 | 2.44 |
| Diluted EPS | 2.45 | 1.53 | 2.44 |
| Particulars | Fiscal 2023 | Fiscal 2022 | Fiscal 2021 |
| (in Rs. million, except percentages and ratios) | |||
| Rev. from contracts | 5954.95 | 4609.16 | 4952.17 |
| Growth in Rev from contracts | 29.20% | -6.93% | NA |
| Total Income | 6143.2 | 4708.39 | 5130.26 |
| EBITDA | 691.76 | 646.07 | 536.84 |
| EBITDA Margin (%) | 11.62% | 14.02% | 10.84% |
| Profit Before Tax | 203.72 | 132.94 | 89.49 |
| Profit Before Tax Margin (%) | 3.42% | 2.88% | 1.81% |
| Profit for the year | 129.72 | 81.97 | 142.05 |
| Profit for the year Margin (%) | 2.18% | 1.78% | 2.87% |
| ROCE (%) | 3.91% | 3.99% | 2.47% |
| RONW (%) | 3.14% | 2.04% | 3.17% |
| Net Debt | 3198.28 | 2600.86 | 2246.77 |
| Net Debt to Total Equity | 0.75 | 0.63 | 0.49 |
| Order Book | 5633.53 | 4345.7 | 3356.78 |
Dee Development Engineers IPO Promoters & Shareholding of the Company
Dee Development Engineers has only one promoter, Krishan Lalit Bansal (MD and Chairman). The promoter holds 74.74% of the paid-up equity share capital of the company. The promoter along with promoter group holds 100% of the paid-up equity share capital of the company.
| Particulars | Number of
Equity Shares held |
% of the pre-Offer paid-up
Equity Share capital |
| Promoter (also the Selling Shareholder) | ||
| Krishan Lalit Bansal | 39639.19 | 74.74 |
| Total (A) | 39639.19 | 74.74 |
| Promoter Group | ||
| DDE Piping Components Pvt Ltd. | 752275 | 14.2 |
| Ashima Bansal | 4399900 | 8.3 |
| Shruti Aggarwal | 50 | Negligible |
| Shikha Bansal | 1467130 | 2.76 |
| DEE Group Trust | 500 | Negligible |
| Total (B) | 13399855 | 25.26 |
| Total (A + B) | 53039040 | 100 |
Why Invest in Dee Development Engineers IPO?
While investing in an IPO-bounded company, one should check their fundamentals that help an investor to Visions Company’s financial performance and competitive strength which at last drives its business growth. Fundamental analysis apart from financial and competitive strength, also help you to know the risk factors that can affect the business operations and future prospects of the company. After evaluating the variables such strength weakness, financials, you may strike a balance and decide to invest or not invest in an IPO.
Competitive Strengths:
Leading player in an industry with significant barriers to entry
The company offering specialized process piping solutions for industries like oil & gas, power requires significant level of technical skill and knowhow, which creates entry barrier for new entrants. The process piping solutions industry faces high entry barriers due to the following reasons:-
- Technical Knowhow
- Developing in-house engineering processes
- High initial investment
- Need for skilled labor
- Complex manufacturing technology
Largest player in India's process piping solutions
The company with cumulative installed capacities of 94,500 MT per annum, is a leading process pipe solution provider in the world, with six strategically located manufacturing facilities in India. The facilities spread over an area of approx. 425,578.54 square meters with capacity utilization at 43.10% as of 2023.
There manufacturing facilities are strategically located for facilitating certain type of market and industry like the proposed New Anjar Facility and the Bangkok Facility are strategically located with access to ports, making them ideal for overseas customers.
| Facilities | Fiscal 2023 | |
| Installed Capacity | Capacity Utilization (in %)* | |
| Palwal Facility I | 9000 | 5.62% |
| Palwal Facility II | 3000 | 67.13% |
| Palwal Facility III | 24000 | 78.84% |
| Barmer Facility | 5000 | 55.04% |
| Anjar Facility I | 3000 | 41.60% |
| Bangkok Facility | 14500 | 39.34% |
| Anjar Heavy Fabrication Facility | 36000 | 26.63% |
Long standing customer relationships with a strong order book
The company has mix of domestic and overseas customers, including some of the clients from Fortune 500 companies like Reliance Industries. As of FY23, the company had order book of Rs. 578.7 crores, which constituted 97.19% of revenue from contracts.
The table below shows the breakdown of order book from domestic and overseas customers, along with a % of the order book details against revenue from contracts in preceding years.
| Sectors in which our customers operate | Order book contribution (in Rs. million) as of June 30, 2023 | As a % of revenue from contracts with customers in Fiscal 2023 |
| Oil and gas | 3495.7 | 58.70% |
| Power | 2127.26 | 35.72% |
| Process Industries | 164.42 | 2.76% |
| Total | 5787.38 | 97.19% |
| Customers | Order book contribution
(in Rs. million) as of June 30, 2023 |
As a % of revenue from contracts
with customers in Fiscal 2023 (%) |
| Domestic customers | 2979.78 | 50.04% |
| Overseas customers | 2807.6 | 47.15% |
| Total | 5787.37 | 97.19% |
| Customers | Fiscal 2023 | Fiscal 2022 | ||
| Revenue contribution
(in Rs. million |
As a % of total revenue from contracts with customers | Revenue contribution
(in Rs. million |
As a % of total revenue from contracts with customers | |
| Largest customer | 822.17 | 13.81% | 781.54 | 16.93% |
| Top 10 customers | 3928.08 | 65.96% | 3374 | 73.20% |
| Top 20 customers | 5159.73 | 86.65% | 4188.141 | 90.87% |
Wide range of specialized offerings
The company offers diversified product portfolio includes piping spools, induction pipe bends, industrial pipe fittings, pressure vessels, modular piping, industrial stacks, wind turbine towers, and pilot plants.
Focus on automation and process excellence
Their facilities are equipped with a mix of automation and manual processes. The company plans to combine its engineering capabilities with capital expenditure to induce productivity, cost control, and consistent product quality. In FY23, FY22 and FY21, the capital expenditure compared to revenue were 12.24%, 5.78%, and 3.61%.
Risks Factors:
Downturn in the oil and gas, power industry could impact revenue
As can be seen from the table below, company's revenue contribution from customers is highly dependent on oil and gas & power sector. Any effect on the raw material related to these sectors can have adverse effect on business.
Factor that could have adverse affect to the company are mentioned below
- Fluctuations in oil and gas prices
- Seasonality of sectoral demand
- Failure by customers to market their products
- Regulatory bans
- Trade sanctions
- Economic conditions of targeted market
| Sectors | Fiscal 2023 | Fiscal 2022 | Fiscal 2021 |
| % of total revenue from contracts | % of total revenue from contracts | % of total revenue from contracts | |
| Oil and Gas | 51.35% | 42.39% | 32.52% |
| Power | 34.16% | 39.81% | 44.79% |
| Power Generation through Biomass Generation Plant | 12.41% | 17.02% | 13.33% |
| Process Industries | 2.01% | 0.78% | 4.62% |
| Chemical | 0.07% | 0.00% | 4.74% |
Competition and innovation
Even though this industry has high barriers to entry, none the less this industry face competition from established players like L&T Heavy Engineering's pipe fabrication division, a Seonghwa Industrial Co. Limited, etc. The success of the business depends on anticipating and identifying customer preferences, offering products and services that customers require. So the company has to constantly strive to develop innovation capabilities to introduce new products and services based on customer preferences and demand.
Dee Development Engineers IPO Grey Market Premium (GMP)
The DEE Development Systems IPO Grey Market Premium is trading Rs. 40. The price will be disclosed and as per the demand and supply of the share price in the open market, the Dee Development Engineers IPO GMP will be known. If the IPO price is undervalued, less GMP and as per the valuation of the stock overvalued there is less chance for higher GMP.
How to Apply for Dee Development Engineers Limited IPO?
If you have a share trading and demat account at Moneysukh, you can easily apply for the Dee Development Engineers Limited IPO. Just follow the steps given below.
Step 1: Once Dee Development Engineers Limited IPO opens you can apply online.
Step 2: Browse at trade.moneysukh.com and log in with your Moneysukh User ID & password.
Step 3: Now you have to visit the IPO section and select Dee Development Engineers Limited IPO.
Step 4: Here just fill in the required such as bidding price, quantity or lot and so on.
Step 5: Now you have to make the payment and your IPO application is successful.
How to Check Dee Development Engineers Limited IPO Allotment Status?
Just like applying, checking the Dee Development Engineers Limited IPO Allotment Status is also very easy and hassle-free through Moneysukh online platform. You have to just wait till the IPO is closed and the allotment is finalized. If you have been allotted any share it will be transferred into your demat account that you can sell after listing of the shares on the NSE or BSE stock exchanges.
Also Read: How to Increase the Chances of IPO Allotment
However, if IPO is oversubscribed and unfortunately if you have not been allotted any share, your IPO application money will be returned to your bank account or linked account where you have allocated the fund while applying for the Dee Development Engineers IPO.
Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh
