Company and IPO Overview:
Established in 1997, Pyramid Technoplast Limited is a company engaged in manufacturing of polymer-based molded products (Polymer Drums), primarily used by chemical, agrochemical, specialty chemical, and pharmaceutical companies to fulfill their packaging requirements.
Pyramid Technoplast is a leading manufacturer of sturdy Intermediate Bulk Containers (IBCs) in India, crafting IBCs with a capacity of 1,000 litres. The company also produces mild steel (MS) drums designed for the secure packaging and transport of chemicals, agrochemicals, and specialty chemicals. The company markets and sells its products under the brand name "Pyramid."
Currently, the company has six strategically located manufacturing units out of which four are situated in Bharuch, GIDC, Gujarat and two are situated at Silvassa, UT of Dadra and Nagar Haveli. The seventh manufacturing unit is under development at Bharuch, GIDC, Gujarat, next to the previous six units. This gives the company a total capacity of 20,612 MTPA in Polymer Drum manufacturing machines, a total installed capacity of 12,820 MTPA for the IBC manufacturing facility, and a total installed capacity of 6,200 MTPA for MS drum units.
Pyramid Technoplast has obtained UN certification for IBCs and MS Drums to align with the safety standards outlined by the United Nations. The company's manufacturing units hold ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018 certifications, which are awarded by quality, environment, health, and safety management systems for the production of Polymer Drums, carboys, jerry cans, IBCs, MS Drums, and related accessories. Furthermore, MS Drums conform to the quality standards specified in IS 1783:2014 (Part 1 and 2), as established by the Bureau of Indian Standards.
Pyramid Technoplast IPO is the next main board IPO which is ready to set its footprints in the stock market and the company is about to raise around ₹ 153.05 crores via IPO comprising Offer For Sale upto ₹61.75 crores and Fresh Issue upto ₹ 91.30 crores. The price band of the issue is ₹ 151 to ₹ 156 with a minimum market lot of 90 shares. Pyramid Technoplast IPO subscription for retail quota is 50.00%, NII is 20.00% and QIB is 30.00%.
Financials (rounded off):
Date | Total Revenue (₹ in cr) | PAT (₹ in cr) |
31/03/2021 | 316 | 17 |
31/03/2022 | 403 | 26 |
31/03/2023 | 483 | 32 |
Objectives of the Issue:
1. Repayment and/or prepayment, in full or part, of certain outstanding borrowings availed by the company.
2. Funding working capital requirements of the company.
IPO Details:
IPO Date | 18/08/2023-22/08/2023 |
Face Value | ₹10 per share |
IPO Price Band | ₹155-₹166 per share |
IPO Lot Size | 90 Shares |
Listing at | NSE, BSE |
Basis of Allotment | 25/08/2023 |
Credit of Shares in Demat | 29/08/2023 |
Listing Date | 30/08/2023 |
Pre-Issue Shareholding | 100% |
Post-Issue Shareholding | 74.94% |
Retail Minimum Lot Size | 90 shares (₹14,940) |
Valuations & Margins:
Indicators | FY 21 | FY 22 | FY 23 |
EPS | 5.41 | 8.43 | 10.24 |
P/E | - | - | 16.21 |
EBITDA (%) | 10.28 | 11.03 | 10.75 |
Debt/Equity | 1.05 | 0.86 | 0.52 |
ROCE (%) | 21.11 | 21.38 | 21.37 |
Important things to note about the Company:
Top reasons to consider the IPO:
1. Over the years Pyramid Technoplast has established relationships with customers from diverse industries like chemicals, agrochemicals, pharmaceuticals, lubricants and edible oil by supplying them with Polymer Drums, IBC and MS drums. During the past three years, the company has served more than 376 customers on a regular basis.
2. Pyramid Technoplast offers complete bulk industrial packaging solutions to its clients since it manufactures polymer-based bulk packaging drums and IBC, as well as MS Drums for packaging.
3. The plants of Pyramid Technoplast are located in the production hubs for a variety of sectors like chemicals, agrochemicals, pharmaceuticals, lubricants, edible oil, and so on. The proximity of Pyramid Technoplast’s to these industries allows for simple access and delivery of the company’s products to these industries in these industrial districts.
4. Before being supplied to clients, Pyramid Technoplast products are subjected to extensive quality checks to ensure that they meet industry requirements.
5. Pyramid Technoplast performs various strength tests on containers, such as hydrostatic and pneumatic testing for leaks and ruptures, environmental stress cracking resistance testing, and so on. These tests verify that its products fulfill the industry standards for safety, durability, and environment that clients desire.
Risk factors to watch out in the IPO:
1. Pyramid Technoplast is required to adhere to government policies, international standards or customer quality norms for manufacturing industrial packaging products. Changes in any one of these factors which the company won’t be able to adhere to, can affect the growth of the business.
2. During FY23, the company Pyramid Technoplast has availed unsecured loans amounting to ₹2.05 crores. If any lender seeks repayment of any such loan, the company may not have sufficient operating cash for its business operations.
3. The polymer used to make IBCs and polymer drums account for a sizable amount of the company’s total expenses. Because the polymer is derived from oil, any increase in crude price or decrease in polymer availability could have a negative impact on the company’s business.
4. Pyramid Technoplast also doesn’t have any long-term agreements with its suppliers for the supply of raw materials. Thus, it is subject to uncertainties in the supply of raw materials and there is no assurance that its suppliers will continue to sell raw materials according to its requirements.
5. Several proceedings are pending before numerous courts, inquiry officers, and appellate forums at various stages of adjudication. Orders issued in such procedures that are detrimental to its interests may harm its reputation and standing, as well as have an adverse effect on its operations.
Crisp Insights:
Pyramid Technoplast IPO GMP Today: The Company is commanding a GMP of around Rs.25.
Pyramid Technoplast IPO Review: Listing gains unlikely as per GMP data.
Pyramid Technoplast GMP is less and hence, investors must be cautious.
Disclaimer: All information is provided for educational and informational purpose only. Data is fetched from publicly available sources such as the DRHP filed by the company. The website or the author takes no guarantee for the accuracy of the data however, we have tried our best to present accurate data to out readers. Please consult a financial advisor or do your own analysis before investing/trading in the stock market.