Subam Papers IPO: Key Insights into the Upcoming SME IPO Opportunity
Subam Papers Limited is set to launch its IPO in September 2024, providing investors with a chance to invest in a key player in the Kraft paper manufacturing sector. With a strong product range and an extensive production capacity, this IPO brings exciting opportunities for growth.
Here’s a detailed guide on the Subam Papers IPO, covering company information, key dates, financial highlights, and more.
Subam Papers Limited: Company Overview
Incorporated in October 2006, Subam Papers Limited is a leading manufacturer of Kraft Paper and paper products, catering to a wide range of industries. The company primarily uses waste paper as its raw material, demonstrating a commitment to sustainability in its manufacturing processes.
As of March 31, 2024, the company boasts an installed capacity of 300 metric tons per day (MTPD) for Kraft Paper, translating to an annual capacity of 93,600 tons. Subam Papers’ diverse product line includes Kraft Paper and Duplex Boards, available in various shades, GSM ranges, and sizes. This versatility ensures that their products meet the varied requirements of the packaging industry.
Key Product Specifications:
- GSM Range: 120 to 300
- Bursting Factor (BF): 16 to 35
- Deckle Sizes: 2,000 MM to 4,400 MM
- Reel Diameters: Up to 1,400 MM
To ensure uninterrupted production, Subam Papers maintains a robust raw material storage facility, ensuring continuous, high-quality output.
Subam Papers IPO: Key Details and Dates
Below are the key details for the Subam Papers IPO:
- IPO Opening Date: September 30, 2024
- IPO Closing Date: October 3, 2024
- Allotment Finalization: October 4, 2024
- Listing Date: October 8, 2024
- Price Band: ₹144 to ₹152 per share
- Minimum Lot Size: 800 shares
- Minimum Investment for Retail Investors: ₹121,600 (1 lot)
- Minimum Investment for HNI: ₹243,200 (2 lots)
- Issue Size: ₹93.70 crore (61.65 lakh shares)
Objects of the Issue
The net proceeds from the Subam Papers IPO will be used for the following purposes:
- Investment in a Subsidiary: The funds will be used to finance capital expenditure requirements for the company's subsidiary.
- General Corporate Purposes: The funds will also help in boosting operational efficiency and expanding corporate activities.
Financial Performance and Projections
Subam Papers Limited has shown mixed financial results over the past few years. While revenue slightly decreased in the last fiscal year, profit after tax (PAT) surged significantly. Below is a snapshot of Subam Papers’ financial performance:
| Period Ended | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 |
|---|---|---|---|
| Assets (₹ Lakhs) | 46,046.1 | 41,434.65 | 39,418.33 |
| Revenue (₹ Lakhs) | 49,697.31 | 51,062.36 | 33,259.87 |
| PAT (₹ Lakhs) | 3,341.8 | -26.79 | 2,600.23 |
| Net Worth (₹ Lakhs) | 19,904.12 | 16,562.32 | 16,589.11 |
| Reserves (₹ Lakhs) | 19,741.35 | 16,399.55 | 16,426.34 |
| Total Borrowing (₹ Lakhs) | 18,340.77 | 16,282.61 | 15,573.37 |
Between FY 2023 and FY 2024:
- Revenue decreased by 3%.
- Profit after tax (PAT) witnessed a remarkable increase, jumping by 12,574% as the company rebounded from losses in the previous fiscal year.
Grey Market Premium (GMP) Analysis
Grey Market Premium (GMP) is a key indicator of the market sentiment for an IPO. Investors can monitor the GMP closer to the listing date, as it often provides insights into the potential demand for shares.
IPO Allotment Process and Timeline
The allotment process for the Subam Papers IPO follows a transparent procedure, ensuring that investors have an equal chance of securing shares. Key milestones include:
- Allotment Finalization: Expected on October 4, 2024.
- Refund Process: Refunds for unsuccessful applicants will start by October 5, 2024.
- Listing on BSE SME: Shares will be listed on October 8, 2024.
Investors can check their allotment status using their PAN or application number on the registrar’s website.
Risks and Opportunities
Investing in Subam Papers Limited comes with its own set of risks and opportunities:
- Strengths: Strong foothold in the Kraft paper industry, with a high production capacity and sustainable raw material usage.
- Weaknesses: Recent decline in revenue, reliance on waste paper as a raw material, and competition within the packaging industry.
- Opportunities: Growing demand for eco-friendly packaging solutions, potential for export market expansion, and capital expenditure to increase capacity.
- Threats: Fluctuations in raw material prices, environmental regulations, and competitive pressures from both local and global manufacturers.
Conclusion
The Subam Papers IPO presents an opportunity to invest in a growing company within the Kraft paper manufacturing industry. With a well-established product range, a commitment to sustainability, and significant potential for growth, this IPO has the potential to attract a wide range of investors. The IPO opens for subscription on September 30, 2024, and closes on October 3, 2024. As always, investors should review the company’s financials and market position before making an investment decision.