Business Profile of Epack Prefab Technologies Limited
The upcoming IPO of EPAC PREFAB Technologies Ltd. operates in two businesses which are PreFab businesses where the company provides solutions on a turnkey basis which includes designing, installation, manufacturing, and erection pre-engineering, fabrication, and its components in the domestic market and abroad and has a capacity of 8400 MTPA. PreFab business has manufacturing facilities in Greater Noida, Ghiloth, and Mambattu. The other business includes the manufacturing of polystyrene sheets and blocks also known as “EPS Blocked Molded” products and “EPS Shape Molded” for uses in construction, packaging, and consumer goods in India. The company was established in 1999 and has been operating in the market for over 25 years.
IPO Objective of Epack Prefab Technologies
As per the draft red hearing prospects, the IPO issue consists of offer for sale and fresh issue. The OFS consists of up to o 10,000,000 Equity Shares and fresh issue of ₹3,000.00 million at the face value of ₨ 2 each aggregating up to XXXX. There is fresh issue & OFS of shares by company and main objective of company for listing is to financing capital expenditure related to setting up new manufacturing sites and expansion of existing sites. Along with it company repayment of borrowing and general corporate expense.
IPO Details of Epack Prefab Technologies Ltd:
| IPO Open Date | N.A. |
| IPO Close Date | N.A. |
| Basis of Allotment | N.A. |
| Listing Date | N.A. |
| Face Value | ₹2 per share |
| Price | N.A. |
| Lot Size | N.A. |
| Total Issue Size | Up to XXXX Equity Shares |
| Aggregating up to ₹ XXXX million | |
| Fresh Issue | Up to XXXX Equity Shares |
| Aggregating up to ₹3,000.00 million | |
| Offer For Sale | Up to 10,000,000 Equity Shares |
| Aggregating up to ₹ XXXX million | |
| 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 more than 35% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
Issue Price & Size of Epack Prefab Technologies Limited IPO
The issue price of EPACK PREFAB TECHNOLOGIES LIMITED hasn’t been released yet. Upon releasing the dates, the investors can bid between those price ranges. The company has an offer for sale of 10,000,000 and fresh issue aggregating up to ₹3,000.00 million equity shares at the price of ₨XXXX.
Launch Date of Epack Prefab Technologies IPO
The IPO opening date of EPACK PREFAB TECHNOLOGIES LIMITED hasn’t been officially announced yet, upon the declaration of dates investor can bid for IPO.
Financial Statements of Epack Prefab Technologies Ltd.
| Particulars | six months ended Sept. 30 , 2024 |
ended March 31 , 2024 |
ended March 31 , 2023 |
ended March 31 , 2022 |
| INCOME | ||||
| Revenue from operations | 5,369.87 | 9,049.02 | 6,567.61 | 4,501.06 |
| Other income | 29.48 | 14.73 | 37.32 | 31.08 |
| Total Income | 5,399.36 | 9.063.75 | 6,604.92 | 4,532.14 |
| EXPENSES | ||||
| Cost of material consumed | 3,530.98 | 6,524.18 | 4,750.79 | 3.180.63 |
| Purchase of traded goods | - | - | - | - |
| Changes in inventories of finished goods , stock - in- trade and work - in - progress |
38.37 | ( 397.56 ) | ( 187.48 ) | ( 68.74 ) |
| Employee benefits expenses | 464.82 | 649.54 | 393.81 | 302.60 |
| Finance costs | 111.63 | 172.66 | 123.27 | 55.15 |
| Depreciation and amortisation expense | 82.92 | 126.68 | 102.16 | 70.27 |
| Other expenses | 779.92 | 1,402.94 | 1,095.18 | 731.18 |
| Total Expenses | 5,008.63 | 8,478.43 | 6,277.74 | 4,271.08 |
| Restated profit / ( loss ) before associate and exceptional items and tax | 390.73 | 585.32 | 327.19 | 261.06 |
| Share of profit / ( loss ) of associate | ( 19.22 ) | ( 0.57 ) | ( 0.21 ) | - |
| Restated profit before exception item and tax | 371.50 | 584.75 | 326.98 | 261.06 |
| Particulars | ended Sept 30, 2024 | Fiscal 2024 |
Fiscal 2023 |
Fiscal 2022 |
| Revenue from operations ( million ) | 5,369.87 | 9,049.02 | 6,567.61 | 4,501.06 |
| Growth in Revenue from Operations ( % ) | NA | 37.78 % | 45.91 % | NA |
| EBITDA ( million ) | 555.79 | 869.92 | 515.30 | 355.40 |
| EBITDA Margin ( % ) | 10.35 % | 9.61 % | 7.85 % | 7.90 % |
| EBIT ( million ) | 472.87 | 743.24 | 413.14 | 285.13 |
| EBIT Margin ( % ) | 8.81 % | 8.21 % | 6.29 % | 6.33 % |
| Profit After Tax ( million ) | 276.76 | 429.59 | 239.72 | 195.23 |
| Profit After Tax Margin ( % ) | 5.13 % | 4.74 % | 3.63 % | 4.31 % |
| Return on Equity ( % ) | 15.14 % | 29.12 % | 21.01 % | 21.16 % |
| Return on Capital Employed ( % ) | 13.46 % | 27.21 % | 20.31 % | 19.33 % |
| Total Asset Turnover ( x ) | 0.81 | 1.73 | 1.78 | 1.83 |
| Fixed Asset Turnover | 2.25 | 4.70 | 4.46 | 4.12 |
| Net Working Capital Days | 75 | 24 | 32 | 22 |
| Net Debt ( million ) | 1781.36 | 1296.20 | 926.33 | 655.00 |
| Net Debt to EBITDA ( x ) | 3.21 | 1.49 | 1.80 | 1.84 |
| Net Debt to Equity ( x ) | 0.91 | 0.77 | 0.73 | 0.64 |
Promoters & Shareholding of Epack Prefab Technologies Limited
As of date, there are five promoters of the company. The promoter along with promoter group in aggregate collectively holds 100% of the paid-up share capital of company.
| Name of the Shareholder | Pre - Offer | Post - Offer | ||||
| No. of Equity Sh. As on | % of the pre - Offer | No. of Equity Sh. on diluted basis | % of the Pre-Offer Equity Sh. On diluted basis | Number of Equity Shares held |
%of the Post - Offer Equity Sh. | |
| Promoters | ||||||
| Sanjay Singhania | 7,357,631 | 9.49 % | 7,357,631 | 8.34 % | [ • ] | [ • ] |
| Ajay DD Singhania |
7,525,685 | 9.71 % | 7,525,685 | 8.53 % | [ • ] | [ • ] |
| Bajrang Bothra | 6,326,730 | 8.16 % | 6,326,730 | 7.17 % | [ • ] | [ • ] |
| Laxmi Pat Bothra |
7,387,256 | 9.53 % | 7,387,256 | 8.37 % | [ • ] | [ • ] |
| Nikhil Bothra | 2,721,400 | 3.51 % | 2,721,400 | 3.08 % | [ • ] | [ • ] |
| Promoter Group | ||||||
| Divisha Singhania |
1,758,933 | 2.27 % | 1,758,933 | 1.99 % | [ • ] | [ • ] |
| Preity Singhania | 6,874,460 | 8.87 % | 6,874,460 | 7.79 % | [ • ] | [ • ] |
| Drishikka Singhania | 1,742,298 | 2.25 % | 1,742,298 | 1.97 % | [ • ] | [ • ] |
| Suman Bothra | 5,123,000 | 6.61 % | 5,123,000 | 5.80 % | [ • ] | [ • ] |
| Nitin Bothra | 3,601,866 | 4.65 % | 3,601,866 | 4.08 % | [ • ] | [ • ] |
| Leela Devi Bothra | 4,975,424 | 6.42 % | 4,975,424 | 5.64 % | [ • ] | [ • ] |
| Rajjat Bothra | 7,531,368 | 9.72 % | 7,531,368 | 8.53 % | [ • ] | [ • ] |
| Avishi Singhania |
1,254,935 | 1.62 % | 1,254,935 | 1.42 % | [ • ] | [ • ] |
Should You Subscribe Epack Prefab Technologies IPO?
While investing or subscribing to any IPO, consider the investment rationales related to the company. Hence, here you can find out the strength of the company that will be its growth factors. And also check the risk factors that can affect the growth and operational efficiency of the company.
Competitive Strengths of Epack Prefab Technologies
Strong and diverse market presence
The company has the position of third largest production capacity in the pre-engineered steel building industry and revenue registered 55.48% CAGR between 2022-24 years. EPACK PREFAB has a diversified market presence and portfolio of a comprehensive range of offerings. The company has expertise in cost-effective pre-engineered steel building solutions making a reliable brand in various sectors like infrastructure, industrial, and commercial building.
Strategically advantages
PREFAB Ltd. has location manufacturing facilities and in-house design & engineering strategic advantages along with side sales availability giving it an edge over its competitors in the market. These strategic advantages enable the Company to fulfill customer demand quickly and ensure a timely supply of products. It helps the company to provide location advantage & better flexibility, inventory management, and a unique way to meet the needs of customers.
Strong financial performance
In the previous six months (September 2024), 2023 and 2022 company experienced strong financial growth which was achieved due to continuing focus on operational efficiency and customer outreach. The company recorded 41.79% CAGR between fiscal 2022-2024 and a revenue CAGR 55.48% in 2022-24 increasing from ₨195 billion to ₨210 billion. Along with this company's ROE in 2024 is 29.12% and the ROCE is 28.16% in fiscal 2024..
Better customer relations
The company places emphasis on quality, cost efficiency, and timely project completion which help in building better relations with customers in the market. It is the key driver for enduring better partnerships and improving the performance of the company. In the previous year (Sept. 2024) and in the last three years 2022,2023 and 2024 company successfully delivered more than 1200 customers and over time company focused on building relationships with domestic and global clients..
Risk Factors of Epack Prefab Technologies
Undiversified revenue
The company's main revenue comes from its Pre-Fab business and any decrease in demand for this business will adversely affect the profit margin of the company. Pre-Fab business products have played a significant role in company growth and revenue in past years and too much dependency on one business segment can raise risk for business operations.
Problem in technological advancement
The company is not introducing new engineering processes and faces challenges in adapting to changing customer preferences in a timely and effective manner. In addition, if company services are outdated in technological advancement or development of alternative products the revenue and demand for products can decline. In such conditions, it will adversely affect business operations, cash flow, and financial performance.
Dependency in contract labor
The dependency of a company on contract labor raises risk in the manufacturing of products. Any disruption in the supply of contract labor will create problems in fulfilling the demand of customers and the company is also able to control the composition and cost of labor contracts which could create negative results in the revenue and cash flow of the company. The company may be subject to unrest labor and increased employee costs and it may affect adversely the operation of the business.
Optimum requirement of working capital
The need of a company for working capital is important to maintain its adequate level of raw material, inventories of finished goods, accounts receivable, and other requirements of current business operations. In this situation it creates a risk for the company to provide necessary collateral security to get credit, bank guarantee, or performance bonds which affect its ability to get new contracts and the need to provide collateral also increases the requirement of working capital for the company.
Epack Prefab Technologies Limited Grey Market Premium
Grey market premium is the premium quoted over the IPO issue price. GMP shows that investors are ready to pay above the upper band of the IPO issue price. GMP is determined in the grey market as per the demand and supply of the shares in the primary market. A grey market is that unofficial ecosystem of unlisted companies' stocks that start trading even before the launch of the IPO to the date of its listing.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated & Reliable
However, GMP is not a reliable factor, as it keeps fluctuating as per the demand and supply of shares in the primary market. There are numerous factors that affect the stock market in India and individual stock prices of different companies that are already listed and trading in the secondary market. However, for an IPO-bounded company, you can consider the GMP as the speculative listing price of the share
According to various online sources, the Grey Market Premium or GMP of the epack prefab technologies limited is trading around Rs XX in the grey market. It means shares are trading at the upper band issue price of Rs XX with a premium in the grey market and may list around the same price.
