Prakash Steelage Ltd IPO Message Board (Page 26)

this will be traders faccy stock..........target above 200-300

gmp in jaipur 1500 (full application)

gmo in mumbai 1700-1800 (full application)

Ny body what game going in ths ipo,retail subcripton already over 8,29000.some thng cooking

BSE-NSE demand graph says Prakash Steelage at 11 am subscribed 35%. What is surprising is that the Retail category at cut off is 5,97,480.

gem,
Today & tomorrow are critical days for Engineers India.If stock holds above 330 till tomorrow,expect to sell it at 315-320 post listing. I have shorted 300 shares at 336 & put an order for 300 at 339.

SINCE all the present IPOs like EIL,SKS and BAJAJ were excellent investment opportunities for long run as well as for listing gains, it does necessarily hold good for PRAKASH.

You can judge by the subscription figures of QIBs on the last day and decide whether to go for it only for listing gains because for long term its a sure shot NO....NOT AT ALL....

Analysis:
Prakash Steelage (PSL), engaged in the manufacturing of seamless & welded stainless steel pipes, tubes and U-tubes, has come out with a public issue of 62.5 lakh equity shares of Rs 10 each for cash aggregating to Rs 62.50 crore (lower end of the price band) and Rs 68.75 crore (upper end of the price band).

The company carries out its production through its two state-of-the-art production units situated at Silvasa and Umbergaon (Gujarat). The company increased its manufacturing capacity to 12,200 MTPA in the year 2007 by setting up a new state-of-the-art plant at Umbergaon. Going ahead, it added another 3,400 MTPA taking the total to 15,600 MTPA out of the proposed expansion plan. The company has been exporting its products to several MNCs in more than 40 countries across the globe.
The issue will open on August 5, 2010, for all bidders and close on August 9, 2010, for QIB bidders and on August 10, 2010, for non-QIB bidders. It has fixed the price band between Rs 100 and Rs 110 per equity share.

The company clocked a turnover of Rs 437.10 crore for the year ended March 31, 2010, with EBIDTA of Rs 45.14 crore and profit after tax of Rs 17.82 crore.

The objective of the issue are, amongst others, to raise resources to part finance its expansion plan at the Company’s existing manufacturing facility at Umbergaon, Gujarat and also to meet the additional working capital requirement.

The equity shares are proposed to be listed on the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange of India Limited (NSE).

The book running lead manager to the Issue is Keynote Corporate Services Limited. The Syndicate members to the IPO are Keynote Capitals Limited, ENAM Securities Pvt. Ltd. and SMC Global Securities Limited.

Recommendation:
Subscribed to Prakash Steelage IPO for listing gains.

Prospective Retail Investors would like to take into consideration, inter alia, Progress of Subscription from time to time by Retail category. However, Category wise Progress of Subscription is displayed in both bse and nse web sites only as at the end of day but not posted on hourly basis.

I therefore suggest to work out Progress of Subscription by both NII and Retail categories upto the hour on the Closing Day with the help of following formula:

No. of Times BID by NII and RETAIL Categories upto hour on Closing Day=((A x B) – C}/D

Where—
A= Total No. of Shares OFFERED to ALL categories

B= Total No. of Times subscribed upto hour (for ALL categories)

C= No. of Shares BID by (only) QIBs upto end of previous day

D= Total No. of Shares OFFERED TO NIIs and RETAIL categories

If one develops formulae in Excel, it would be easy to know the Progress of Subscription by both NII and Retail categories on hourly basis on closing day with the help of overall subscriptions figures posted in bse and nse websites

sorry deepak, i mean wrong demate no. yesterday was modification day ..now u cannot do anything..BETTER YOU MAKE STOP PAYMENT...

Prakash Steelage is entering the capital market on 5h August 2010 with a fresh issue of 62.5 lakh equity shares of Rs.10 each, in a price band of Rs.100 to Rs.110 per equity share. The company will raise about Rs. 63-69 crore via the issue, which constitutes 35.71% of post-issue paid-up capital and issue closes on 9th August for QIB bidders and on 10th August for HNIs and retail investors.


The company manufactures seamless and welded stainless steel pipes, tubes and U-tubes at 2 manufacturing facilities located in Silvassa and at Umbergaon in Gujarat, with total installed capacity of 15,600 MTPA. It is undertaking capacity expansion at its Gujarat unit with an investment of Rs.49 crore. The other objects of the issue include meeting working capital requirements and general corporate purpose.


The company has already arranged for Rs. 43 crore via debt and Rs. 5 crore through equity issue (preferential allotment to promoters) for meeting the objects of the issue. Of the total issue, Rs. 15 crore will be used towards capacity expansion, about Rs. 40 crore towards working capital needs and balance for general corporate purposes.


During FY10, the company earned revenue of Rs. 437 crore, of which, Rs. 219 crore was from sale of traded products. It earned net profit of Rs. 18 crore, earning net margin of 4.1% and EPS of Rs. 15.84. As of 31st March 2010, the company’s networth stood at Rs. 51 crore while it had total outstanding debt of Rs. 141 crore, largely working capital loans.


The company’s profitability has been fluctuating due to foreign exchange gains and losses. During FY10, it earned Rs. 2 crore in forex gains, while in FY09, it suffered a loss of Rs. 6.6 crore due to currency fluctuations.


On the lower and upper end of the price band, the company is issuing shares at PE multiples of 6.3 and 6.9 times, respectively. Its larger listed competitor, Ratnamani Metals, having annual sales of Rs. 850 crore, net margins of 9.6% and debt-free status, is presently ruling at a PE multiple of 7.3 times.


Though not much disappointment on the growth and size of the company, but, Prakash Steelage is half the size of Ratnamani Metals in terms of turnover, earns net margins which are less than half of what Ratnamani presently makes, and has largely built its present manufacturing capacity only over the last 2-3 years. These factors must be discounted by atleast 15%, while valuing the company. Also, being a primary market issue, about 10% must be left on the table for prospective investors. Hence, a PE multiple of around 5.5 would have been justified for the issue, as against 6.3 – 6.9 presently. This translates into a fair value of share at Rs. 86. So, even at the lower band of Rs. 100, it is looking expensive.


Hence, investors can give this issue a miss, on the backdrop of expensive valuations.

IMRAN

WELCOME BACK

GO FOR BAJAJ CORP ITS BEST ISSUE IN RECENT 3 IPOS IN TERMS OF % APPRICTION IN COMPARISON TO ISSUE PRICE.

DONT SPECULATE ABOUT THE GMP, LISTING PRICE MAY SUBTANTIALLY CHANGE.

LATEST GMP FROM TWO RESPECTED WEBSITES GREYMARKETPREMIUM AND SMARTINVSTMENT ON 03/08/2010 WAS-

1) SKS RS. 63-65
2) EIL RS. 09-10

EIL SHOULD BE FIRM TILL FPO SHARES IN THE RANGE OF 300-320.
SKS CAN GO TO 1050-1150

RAM,

I HAVE NOTHING TO SAY
U KNOW THAT THIS TYPE OF IPOS R OPERATOR DRIVEN, WHERE THE PRICE WILL GO I DONT KNOW, BETTER EXIT IF ALLOTED AT UR TARGET PRICE, DONT WAIT FOR OPERATORS TO JACK OF THE PRICE.

Prakash Steelage IPO: Pricing appears fair, but debt remains a worry

Its post-issue equity dilution PE works out to 10.80 (at the upper band) and 9.82 (at the lower band) based on the EPS of FY10, while industry average PE is 16.70

Mumbai-based Prakash Steelage Ltd (PSL), a manufacturer of seamless & welded stainless steel pipes, tubes and U-tubes, hits the primary market on 5 August 2010 to raise Rs62.50 crore-Rs68.75 crore. PSL has fixed the IPO price band at Rs100-Rs110 per share. The company is offering 62.50 lakh shares at a face value of Rs10 each.

Qualified Institutional Buyers (QIBs) and Non-institutional Investors (NIIs) have been allotted 30.75 lakh and 9.22 lakh shares respectively. Retail investors will be entitled to 21.52 lakh shares.

PSL's production is done at its two units situated at Silvassa and Umbergaon with total installed production capacity of 12,200 metric tonnes per annum (mtpa).

The issue opens on 5th August for QIBs and closes on 9th August. Bidding for retail investors and NIIs closes on 10th August.

For the year ended 31 March 2010, PSL's EPS (earnings per share) was Rs15.84. The industry average PE stands at 16.70. At the end of the last fiscal, its debt-to-equity ratio stood at 2.77:1.

With the post-issue equity dilution, the PE works out to 10.80 at the upper band and 9.82 at the lower band, based on the EPS of FY10.

PSL reported a net profit of Rs17.82 crore on net sales of Rs437.10 crore for the year ended March 2010. Its total income stood at Rs438.38 crore for the same period.

Following a search-and-seizure conducted by Income-Tax authorities in February 2009, the company filed a voluntary declaration of undisclosed income to the tune of Rs15 crore for which it paid Rs4.87 crore as tax on 25 February 2009.

On 6 July 2009, the company again received a notice under the provisions of Section 153(A) of the Income-Tax Act, 1961, directing it to file a true and correct return of total income for the assessment year (AY) 2003-04, AY 2004-05, AY 2005-06, AY 2006-07, AY 2007-08 and AY 2008-09 from the I-T Department.

PSL plans to buy plant & machinery worth Rs33.67 crore and other fixed assets worth Rs1.68 crore from the proceeds of the IPO. As on 31 March 2010, the company had an outstanding unsecured loan of Rs42.80 crore.

The IPO proceeds will also be used to fund expansion of its existing manufacturing facility at Umbergaon at a cost of Rs48.55 crore, and meet additional working capital requirements.

Keynote Corporate Services is the lead book running manager to the issue. Rating agency Credit Analysis & Research Ltd (CARE) has assigned an 'IPO Grade 2' to the proposed offering, indicating 'Below Average' fundamentals.

bhailog midfield koi idea kya bhav pe beche

Thanks sreedhar.Orient green power is the one Iam looking forward too.

why it's climbing????

TAKEN FROM ET
CONCERNS:

In the past five financial years, the company had reported negative operating cash flows for 4 times, which adds to our concern regarding availability of free cash flows.

VALUATION:

At the upper price band, the offer price works out to be around 10 times the company’s earning per share for FY10 adjusted for IPO equity dilution. This is lower than the industry average of about 15. The company’s book value post IPO comes around 67. With a P/E of around 10 and price to book value of 1.64, issue looks fairly priced.

Given the company’s potential to grow and an increase in demand in the organised stainless steel manufacturing industry, Prakash Steelage can post healthy sales and profit growth after its capex cycle is over. Retail investors with high-risk appetite can consider the issue.

Shiny,
It is offering nothing special compared to other listed peers so I am avoiding it.