What You Must Know About Jay Bee Laminations IPO: Price Band ₹138 to ₹146 Per Share

Since its founding in 1988, Jay Bee Laminations Ltd. has been a supplier of cold-rolled non-grain-oriented (CRNGO) and grain-oriented (CRGO) silicon steel cores. The company produces and provides a variety of goods for the power industry, such as electrical laminations, slotted coils, and assembled cores in cold-rolled grain-oriented silicon steel and cold-rolled non-grain-oriented steel used in transformers, UPSs, and inverters.

The company's 10,878 square meter production facilities are outfitted with specialised machinery for electrical steel core cutting, slitting, assembly, and testing (CRGO and CRNGO). In addition, the company has a tooling department for honing blades and a laboratory for testing finished goods and raw materials. The existing facilities have everything needed to support clients that produce transformers up to 220 kV class. Furthermore, as of December 31, 2023, the business has utilised 84% of its installed capacity.

Jay Bee Laminations' clientele includes manufacturers of transformers, including power and distribution transformers, with voltage ratings between 11 and 220 kV. As of March 31, 2024, the company had 277 workers.
 

The Objective of the Issue

• Funding Our Working Capital Requirements: Jay Bee Laminations plans to use some IPO proceeds to bolster its working capital. This will ensure the company has sufficient funds to manage daily operational expenses, such as purchasing raw materials, paying salaries, and maintaining inventory, enabling smoother business operations and growth.
• General Corporate Expenses: The IPO funds allocated for general corporate expenses will support various business activities, including administrative costs, marketing efforts, and potential debt repayment. This financial flexibility will help Jay Bee Laminations manage its operations more efficiently and adapt to market opportunities or challenges.

Highlights of Jay Bee Laminations IPO

Jay Bee Laminations IPO is set to launch with a fixed price issue of ₹88.96 crores. The issue comprises a fresh issue of 45.7 lakh shares aggregating to ₹ 66.72 crores and an offer for sale of 15.23 lakh shares aggregating to ₹ 22.24 crores. Here are the key details of the IPO:

• The IPO opens for subscription on 27th August 2024 and closes on 29th August 2024.
• The allotment is expected to be finalised on 30th August 2024.
• Refunds will be initiated on 2nd September 2024.
• Credit shares to Demat accounts are also expected on 2nd September 2024.
• The company will tentatively list on BSE SME on 3rd September 2024.
• The price band is set at ₹138 to ₹146 per share.
• The lowest lot size for the IPO application is 1000 shares.
• Retail investors need to invest a minimum of ₹146,000.
• The minimum investment for High-Net-Worth Individuals (HNIs) is 2 lots (2,000 shares), amounting to ₹292,000.
• Swaraj Shares And Securities Private Limited is the book-running lead manager for the IPO.
• Bigshare Services Pvt Limited serves as the registrar.
• Shreni Shares is the market maker.

Jay Bee Laminations IPO - Key Dates

Jay Bee Laminations IPO Issue Details/Capital History

The book-built offering of Jay Bee Laminations IPO is ₹ 88.96 crore Jay Bee Laminations IPO. The issue consists of an offer to sell 15.23 lakh shares, valued at ₹ 22.24 crores, and a new issuance of 45.7 lakh shares, valued at ₹ 66.72 crores.

The subscription period for Jay Bee Laminations IPO begins on 27th August, 2024, and ends on 29th August, 2024. The allotment for the Jay Bee Laminations IPO is anticipated to be completed on 30th August, 2024. The tentative listing date for the Jay Bee Laminations IPO is 3rd September, 2024, and will take place on the NSE SME.

Jay Bee Laminations IPO Allocation & Minimum Investment Lot Size

The IPO shares of the business are distributed as follows:

Investors can place bids for a minimum of 1,000 shares, with additional bids required in multiples of this amount. The table below illustrates the minimum and maximum investment limits for retail investors and high-net-worth individuals (HNI) regarding shares and monetary value.

SWOT Analysis: Jay Bee Laminations IPO

Strengths:

• Established Market Position: Jay Bee Laminations has a solid reputation in the laminations industry, with a strong customer base and consistent product demand.
• Experienced Management Team: The company benefits from a knowledgeable management team with extensive industry experience, contributing to effective decision-making and operational efficiency.
• Strategic Use of IPO Proceeds: Focusing on working capital and corporate expenses reflects a sound financial strategy to strengthen operations and enhance growth prospects.

Weaknesses:

• High Dependency on Key Customers: The company may rely heavily on a few major clients, which could pose risks if these relationships weaken.
• Limited Product Diversification: A narrow product portfolio could limit growth opportunities and make the company vulnerable to market fluctuations in the laminations sector.
• Capital-Intensive Operations: The industry requires significant investment in machinery and technology, which could strain resources if not managed properly.

Opportunities:

• Growing Demand for Laminated Products: With increasing applications in various industries, there is potential for growth in the lamination market.
• Expansion into New Markets: The IPO funds could be used to explore new geographical markets, increasing the company's reach and revenue streams.
• Technological Advancements: Investing in new technologies could improve product quality and operational efficiency, giving the company a competitive edge.

Threats:

• Market Competition: The laminations industry is competitive, with several players vying for market share, which could pressure pricing and margins.
• Economic Downturns: Economic instability could reduce demand for the company's products, impacting revenue and profitability.
• Regulatory Challenges: Compliance with industry regulations and environmental standards could increase operational costs and impact business operations.

Financial Highlights: Jay Bee Laminations Limited

Here are the financial details of Jay Bee Laminations Limited from March 2022 to March 2024:

The financial performance of Jay Bee Laminations Limited over the past three fiscal years shows significant growth. As of 31st March, 2024, the company’s total assets increased to ₹13,091.32 million, up from ₹10,897.58 million in 2023 and ₹9,514.73 million in 2022, reflecting a robust asset base expansion. Revenue has steadily risen, reaching ₹30,349.56 million in 2024, compared to ₹24,748.86 million in 2023 and ₹14,167.39 million in 2022, indicating strong sales growth.

Profit After Tax (PAT) has also improved significantly, with ₹1,935.27 million reported in 2024, up from ₹1,360 million in 2023 and ₹571.63 million in 2022, demonstrating increased profitability. The company's net worth increased to ₹6,281.44 million in 2024, driven by higher reserves and surplus, which grew to ₹4,481.68 million in 2024 from ₹4,046.21 million in 2023.

Total borrowing decreased to ₹2,416.15 million in 2024 from ₹3,143.25 million in 2023, indicating a reduction in debt levels, which contributes to a healthier financial structure.