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Introduction
Vilas Transcore Initial Public Offering (IPO) is a book-built issue of Rs 95.26 crores, consisting entirely of a fresh issue of 64.8 lakh shares.
The subscription for Vilas Transcore IPO opened on May 27, 2024, and will close on May 29, 2024. The Vilas Transcore IPO allotment is set to be finalized on Thursday, May 30, 2024.
Vilas Transcore IPO will be listed on NSE SME with a tentative listing date set as Monday, June 3, 2024.
Hem Securities Limited is the book-running lead manager of the Vilas Transcore I.P.O., while Big Share Services Pvt Ltd is the registrar for the issue. The market maker for Vilas Transcore IPO is Hem Finlease.
The Company is engaged in the manufacturing and marketing of components used in the power distribution and transmission sector. The Company has shown growth in its top and bottom lines for the reported periods. Based on the fiscal year 2024 earnings, the investment is fairly valued. Informed investors should consider holding onto their funds for the medium to long term.
About the company:
Vilas Transcore Ltd. (VTL) manufactures and supplies components used in the power distribution and transmission sector, primarily for transformers and other power equipment manufacturers in India and abroad.
It produces and supplies a different range of electrical lamination cold rolled grain oriented (CRGO) lamination core, CRGO slit coils, CRGO stacked (assembled cores), CRGO wound core, and CRGO Toroidal cores are primarily utilized in power transformers, including distribution, y-type, high-voltage/medium-voltage, and low-voltage transformers.
The Company manufactures products keeping in mind the industry standards and specifications given by the customer, using the latest technology to manufacture its products and offer customers the defined requirements based on the product dimensions and materials for application in the power & distribution equipment industry.
VTL mainly caters to the power distribution and power engineering industry. Its products, CRGO laminated Core, CRGO core, and slit coils, are one of the most important parts of different kinds of power transformers, distribution transformers & other current transformers.
The core of a transformer is a very important part of the proper functioning of the transformer. The transformer’s core is made of laminated sheets, which are used to minimize current losses.
CRGO steel material is used to reduce hysteresis losses; it provides a low reluctance path for electromagnetic flux and supports the primary and secondary windings of the transformer.
The core is laminated to minimize interference with the efficient energy transfer from the primary coil to the secondary coil.
Considering the importance of core, many points are considered while designing and manufacturing the laminations, like manufacturing, functional reliability, longer service life, economy, etc. The efficiency of the transformer greatly depends on using the right materials and optimizing its shape.
Over the years, it has established long-standing relationships with several well-known Indian and global transformer manufacturers.
Issue details and Capital History:
The Company is coming out with its maiden book-building route IPO of 6480000 equity shares of Rs. 10 each to mobilize Rs. 95.26 crore at the upper cap. It has announced a price band of Rs. 139 – Rs. 147 per share. The minimum application is for 1000 shares and in multiples after that. Post allotment, shares will be listed on NSE SME Emerge. The issue constitutes 26.47% of the post-IPO paid-up capital of the Company.
Usage from the Net Proceeds of IPO:
The company plans to use the net proceeds from the IPO as follows:
- Rs. 5.00 crore for strategic investment and acquisitions
- Rs. 20.10 crore for new factory building construction
- Rs. 45.21 crore for additional plant and machinery
- The remaining amount is for general corporate purposes
The issue is solely led and managed by Hem Securities Ltd., and Bigshare Services Pvt. Ltd. is its registrar. H.E.M. Group’s Hem Finlease Pvt. Ltd. is the market maker for the Company. Accurate Securities and Registry Pvt. Ltd. is the Company’s share transfer agent.
Initially, the company issued equity capital at par. In April 2007, it issued additional equity shares at a fixed price of Rs. 110 per share. Furthermore, in September 2023, the company issued bonus shares in the ratio of 5 for 1.
The average cost of the promoters’ acquisition of shares is Rs. 0.81 per share.
Vilas Transcore IPO Details
| IPO Date | May 27, 2024 to May 29, 2024 |
| Face Value | Rs 10 per share |
| Price Band | Rs 139 to Rs 147 per share |
| Lot Size | 1000 Shares |
| Total Issue Size | 6,480,000 shares |
| (aggregating up to Rs 95.26 Cr) | |
| Fresh Issue | 6,480,000 shares |
| (aggregating up to Rs 95.26 Cr) | |
| Issue Type | Book Built Issue IPO |
| Listing At | NSE SME |
| Shareholding pre-issue | 1,80,00,000 |
| Shareholding post issue | 2,44,80,000 |
| Market Maker portion | 326,000 shares |
Vilas Transcore IPO opened on May 27, 2024, and will be closed on May 29, 2024.
| IPO Open Date | Monday, May 27, 2024 |
| IPO Close Date | Wednesday, May 29, 2024 |
| Basis of Allotment | Thursday, May 30, 2024 |
| Initiation of Refunds | Friday, May 31, 2024 |
| Credit of Shares to Demat | Friday, May 31, 2024 |
| Listing Date | Monday, June 3, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on May 29, 2024 |
Vilas Transcore IPO Anchor Investors Details
Vilas Transcore IPO raises Rs 27.12 crore from anchor investors. Vilas Transcore IPO Anchor bid date is May 24, 2024.
| Bid Date | May 24, 2024 |
| Shares Offered | 18,45,000 |
| Anchor Portion Size (In Cr.) | 27.12 |
| Anchor lock-in period end date for 50% shares (30 Days) | June 29, 2024 |
| Anchor lock-in period end date for remaining shares (90 Days) | August 28, 2024 |
| Application | Lots | Shares | Amount |
| Retail (Min) | 1 | 1000 | Rs 147000 |
| Retail (Max) | 1 | 1000 | Rs 147000 |
| HNI (Min) | 2 | 2,000 | Rs 294000 |
The price band for Vilas Transcore IPO is set at Rs 139 to Rs 147 per share. The application has a minimum lot size of 1000 shares. The minimum investment required by retail investors is Rs 147,000. The minimum lot size investment for high net-worth individuals (HNI) is 2 lots (2,000 shares), amounting to Rs 294,000.
Vilas Transcore IPO Promoter Holding
The promoters of the company are Nilesh Jitubhai Patel and Natasha Jitubhai Patel.
| Share Holding Pre-Issue | 99.97% |
| Share Holding Post Issue | 73.01% |
The Vilas Transcore IPO is subscribed 10.38 times on May 27, 2024, 4:53:57 PM (Day 1). The public issue subscribed 14.36 times in the retail category, 5.34 times in the QIB category, and 7.84 times in the NII category.
| Category | Subscription (times) | Shares Offered | Shares bid for |
| QIB | 5.34 | 12,31,000 | 65,75,000 |
| NII* | 7.84 | 9,24,000 | 72,43,000 |
| Retail | 14.36 | 21,54,000 | 3,09,25,000 |
| Total | 10.38 | 43,09,000 | 4,47,43,000 |
Total Application: 31,227
Vilas Transcore IPO Reservation
Vilas Transcore IPO offers 6,480,000 shares. 1,231,000 (19.00%) to QIB, 924,000 (14.26%) to NII, 2,154,000 (33.24%) to RII, and 1,845,000 (28.47%) to Anchor investors.
| Investor Category | Shares Offered |
| Anchor Investor Shares Offered | 1,845,000 (28.47%) |
| Market Maker Shares Offered | 326,000 (5.03%) |
| QIB Shares Offered | 1,231,000 (19.00%) |
| NII (HNI) Shares Offered | 924,000 (14.26%) |
| Retail Shares Offered | 2,154,000 (33.24%) |
| Total Shares Offered | 6,480,000 (100%) |
Vilas Transcore IPO Timeline (Tentative Schedule)
Vilas Transcore IPO opened on May 27, 2024, and will close on May 29, 2024.
| IPO Open Date | Monday, May 27, 2024 |
| IPO Close Date | Wednesday, May 29, 2024 |
| Basis of Allotment | Thursday, May 30, 2024 |
| Initiation of Refunds | Friday, May 31, 2024 |
| The credit of Shares to Demat | Friday, May 31, 2024 |
| Listing Date | Monday, June 3, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on May 29, 2024 |
Our Analysis of Vilas Transcore Limited
‘One Should Apply for subscription to its IPO’
India is the third-largest producer and consumer of electricity in the world, boasting an installed power capacity of 423.35 GW as of July 31, 2023. The country is making significant strides towards achieving complete household electrification, as envisioned by the Saubhagya scheme. By March 2023, over 28.6 million households had been electrified under this initiative. The power sector in India is poised for exponential growth in the coming years. However, a substantial portion of the population still lacks access to electricity. The next major revolution in India is anticipated to occur in the power sector, with the government focusing on illuminating underserved areas.
This presents a significant opportunity for companies in the power sector. Vilas Transcore Ltd., with its extensive experience in manufacturing input equipment for transformers and the broader power equipment sector, stands to benefit from this growth. The company’s long-standing relationships with key customers, such as Voltamp Transformers Limited, Electrotherm India Limited, Atlas Transformers India Limited, and Shilchar Technologies Limited, underscore its critical role in the industry. According to their website, notable patrons include Voltam Transformers and ABB-like listed players.
Over the past three fiscal years, Vilas Transcore Ltd. has generated more than 60% of its revenue from repeat customers. During this period, the company’s revenue from operations grew from Rs. 13,265.15 lakhs in FY21 to Rs. 28,260.51 lakhs in FY23. The company’s net margins are attractive at 7.13%, and it has gained significant traction in the last two years. With a return on equity (ROE) of 14.72% and a return on assets (ROA) of 10.68% in FY23, the company’s financial performance is robust. At an issue price of Rs. 147 per share, the company is fairly valued with a price-to-earnings (PE) ratio of 15-16.
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Disclaimer: Investing in the Equity market in India is subject to risks, i.e. the market keeps on fluctuating. This article is purely for educational purposes. The views expressed and data provided here are by Equitypandit’s team. Kindly do not completely depend on the information provided as the risk appetite differs from individual to individual and there are various other factors in the market to determine the factors to invest in the market.
