Shree Tirupati Balajee Agro IPO opens on September 5: Check price band, lot size, business model & more

Shree Tirupati Balajee Agro Trading IPO is scheduled to open for subscription on Thursday, September 5. The company manufactures and sells Flexible Intermediate Bulk Containers (FIBCs) and other industrial packaging products.

Ahead of the IPO opening here are seven key things to know about Shree Tirupati Balajee Agro IPO

Shree Tirupati Balajee Agro IPO: Offer size, lot size and price band

Shree Tirupati Balajee Agro IPO aims to raise ₹169.65 crore via its Initial Public Offering (IPO). The industrial packaging products manufacturers’ public issue consists of a fresh issue of 1.47 crore shares, aimed at raising ₹122.43 crore, and an offer-for-sale (OFS) portion of nearly 57 lakh shares, aggregating to ₹47.23 crore.

Shree Tirupati Balajee Agro IPO price band has been fixed at ₹78 to ₹83 per share. Retail investors interested in bidding for Shree Tirupati Balajee Agro IPO can place bids for a minimum lot size of 180 shares, which aggregates to an investment of ₹14,940.

Small non Institutional Investors (sNII) can place bids for a minimum 14 lots comprising 2,520 shares, aggregating to an investment of ₹2,09,160. Big non Institutional Investors can apply for a minimum of 67 lots, or 12,060 shares, which amounts to an investment of ₹10,00,980.

Shree Tirupati Balajee Agro Trading Company has reserved 50% of the net offer for Qualified Institutional Buyers. As much as 35% of the net issue has been set aside for the retail category and 15% of the net issue has been kept aside for the Non Institutional Investor (NII) category.

Shree Tirupati Balajee Agro IPO dates

Shree Tirupati Balajee Agro IPO subscription window is expected to open on Thursday, September 5 and close on Monday, September 9. Shree Tirupati Balajee IPO share allotment status is likely to be finalised on Tuesday, September 10. Refunds will be initiated for unsuccessful bidders on Wednesday, September 11, and the allottees will receive the shares in their demat accounts the same day.

Shares of Shree Tirupati Balajee Agro IPO are likely to be listed on the NSE and BSE on Thursday, September 12.

Shree Tirupati Balajee Agro IPO: Key financials and competitors

Shree Tirupati Balajee Agro Trading Company Limited’s revenue grew by over 15% to ₹552.82 crore in FY24 compared to ₹478.14 crore in FY23. The company’s profit-after-tax jumped more than 74% to ₹36.07 crore in FY24 compared to ₹20.72 crore in FY23. Its net worth increased over 57% to ₹173.07 crore compared to ₹110.21 crore in FY23.

Shree Tirupati Balajee mentioned in its Draft Red Herring Prospectus (DRHP) that it operates in a market characterised by competition from both large, organised firms and smaller regional competitors. The company’s key competitors include Kanpur Plastipack Ltd, Rishi Techtex Ltd, Jumbo Bag Ltd, EMMBI Industries Ltd, and Commercial Syn Bags Ltd.

Shree Tirupati Balajee Agro IPO business model

Shree Tirupati Balajee manufactures Flexible Intermediate Bulk Containers (FIBCs), which are large flexible bags. The company’s product portfolio also includes woven sacks, woven fabric, and narrow fabric tapes.

The company also offers customised products and caters to the bulk packaging solutions needs of industries such as chemicals, agrochemicals, waste disposal, agriculture, and others. It offers an alternative for packaging and transportation, streamlining the loading and unloading processes of vessels, containers, or trucks, thereby reducing labour requirements.

Shree Tirupati Balajee Agro IPO strengths and risks

Strengths:

• The company caters to multiple industries, such as chemicals, agriculture, and food, and its broad Flexible Intermediate Bulk Containers (FIBC) product line ensures stable and visible future revenue streams.
• The company has state-of-the-art manufacturing facilities near Mumbai, which provide excellent connectivity to major ports and highways, enhancing efficiency and reducing costs.
• Shree Tirupati Balajee Agro Trading has various certifications, such as ISO 9001:2015 and ISO 22000:2018, and has quality control setups at every production stage to ensure high standards and client satisfaction.
• Shree Tirupati Balajee Agro Trading has an installed capacity of approximately 2,300 Mt/month and is at nearly full utilisation at 2,200 Mt/month, which shows strong operational efficiency and growth potential.

Risks:

• The company faces contingent liabilities, such as corporate guarantees and tax demands totalling ₹76.41 crore, as of September 30, 2023.
• Failure to meet quality standards or adapt to technological changes could harm the company's reputation and financial performance.
• Despite stringent quality controls, there's no assurance of perpetual compliance with evolving customer and regulatory standards.
• The company is vulnerable to fluctuations in foreign exchange rates, particularly between the Indian Rupee and the USD, which have historically affected its cash flows and financial results.

Shree Tirupati Balajee IPO objective

The company plans to use the money raised via the public issue for repayment and prepayment, in part or full, of outstanding borrowings. The proceeds will also be used for Investment in the company’s subsidiaries Jagannath Plastics Private Limited (JPPL), Shree Tirupati Balajee FIBC Limited (STBFL), and Honourable Packaging Private Limited (HPPL). A portion of the proceeds will also be used for funding incremental working capital requirements of the company and its subsidiaries. The company will also allocate a portion of the funds for general corporate purposes.

About Shree Tirupati Balajee Agro Trading Company

Shree Tirupati Balajee Agro Trading Company was established in October 2001. The company is a manufacturer and seller of Flexible Intermediate Bulk Containers (FIBCs). The company operates through subsidiaries such as Honourable Packaging Private Limited (HPPL), Shree Tirupati Balajee FIBC Limited (STBFL) and Jagannath Plastics Private Limited (JPPL). The company had 857 employees, as of July 2024.