Racks & Rollers - Storage Technologies and Automation Limited’s SME Initial Public Offering to open on Tuesday, April 30, 2024, price band set at ₹73/- to ₹78/- per Equity Share
·
Price Band of ₹73/- – ₹78/- per equity share bearing face value of ₹10/- each
(“Equity Shares”)
·
Bid/Offer Opening Date – Tuesday, April 30,
2024 and Bid/Offer Closing Date – Friday, May 03, 2024.
·
Minimum Bid Lot is 1600 Equity Shares and in multiples of 1600 Equity
Shares thereafter.
·
The Floor Price is 7.3 times the face value of the Equity Share and the Cap Price is 7.8 times the face value of the Equity Share
RISK TO INVESTORS
(i) The Company is dependent on few numbers of customers
for sales. Loss of any of this large customer may affect our revenues and
profitability
(ii) We have certain outstanding litigation against us,
an adverse outcome of which may adversely affect our business, reputationand
results of operations
(iii) The unexpected loss, shutdown or slowdown of
operations at our manufacturing plant could have a material adverse effect
onour results of operations and financial condition.
(iv) Inaccurate estimation of risks, revenues, or costs
for a projects could negatively impact our profitability and operational
results. Actual costs during project execution may significantly deviate from
bid assumptions, leading to challenges in recovering additional expenses and
potentially having a material adverse effect on our operational results, cash
flows, and financial condition.
(v) Our operations are significantly influenced by the
prices, availability, and quality of the raw materials essential for our
production processes.
(vi)
Failure
to successfully implement our business strategies may materially and adversely
affect our business, prospects, financial condition and results of operations.
(vii) Our existing customers does not
guarantee realization of future income. Our revenue may be subject to
modifications, cancellations, delays, holds, or partial payments by customers,
which could have adverse effects on our operational results.
(viii) We have experienced negative cash flows
in the past, and we may have negative cash flows in the future.
(ix) We operate our business from rented premises.
(x) We have incurred losses in the past and may continue
to incur significant losses in the future.
(xi) The Merchant Banker associated with the Issue has
handled 50 public issues (SME Issues) out of which 12 opened below Issue price
on listing day.
(xii)
Average
cost of acquisition of Equity Shares held by our Promoters:- Khasim Sait,
Mohammad Arif Abdul Gaffar Dor , Hanif A Khatri , Nuumaan Khasim , Syed Azeem ,
Afzal Hussain are Rs. 1.11 per equity share of each promoter.
(xiii) The Price/ Earnings ratio based on basic EPS for
Fiscal 2023 for the company at the Cap price is 48.45
(xiv) Weighted Average Return on Networth for Fiscal
2023,2022 and 2021 is 6.29%
(xv) Weighted Average cost of acquisition, Floor and Cap
Price
|
Types of transactions
|
Weighted average cost of acquisition (₹ per Equity Shares) |
Floor price* (i.e. ₹ [73]) |
Cap Price* (i.e. ₹ [78]) |
|
Weighted average cost of acquisition of primary / new issue 18
months prior to RHP |
NA^ |
NA^ |
NA^ |
|
Weighted average cost of acquisition for secondary sale/
acquisition 18 months prior to RHP |
NA^^ |
NA^^ |
NA^^ |
|
Weighted average cost of acquisition of primary issuances /
secondary transactions, during the 3 immediately preceding years* |
- |
- |
- |
^There
were no primary/new issue of shares(equity/convertible securities) transaction,
other than equity shares issued pursuant to bonus issue on January 10, 2024, in
the last 18 months prior to the date of RHP. ^^There were no secondary
sale/acquisition(equity shares) in the last 18 months prior to the date of RHP.
Mumbai,
April 30, 2024: Bengaluru-based Racks & Rollers - Storage
Technologies and Automation Limited is engaged in a storage racking system,
with specialising in design, manufacturing, installation services of metal
storage racks, automated warehouses and other storage solutions, has
fixed the price band of ₹73/- to ₹78/- per Equity Share of face value ₹10/-
each for its maiden initial public offer.
The Initial Public Offering (“IPO” or “Offer”) of the
Company will open on Tuesday, April 30, 2024, for subscription and close on
Friday, May 03, 2024. Investors can bid for a minimum of 1600 Equity
Shares and in multiples of 1600 Equity Shares thereafter.
The issue consists
of a fresh issue of up to 3,840,000 equity shares with no offer for sale (OFS)
component.
The Issue is being made through
the Book Building Process, wherein not more than 50% of the Net Issue shall be available for allocation to
Qualified Institutional Buyers, not less than 15% of the Net Issue shall be available
for allocation to Non-Institutional Investors and not less than 35% of the Net Issue shall be available
for allocation to Retail Individual Investors.
Of the total net proceeds to be
raised through the issue, Rs 27.50 crore will be used to meet working capital
requirements and general corporate expenses.
Racks & Rollers - Storage
Technologies and Automation Limited was incorporated in the year 2010 by its
promoter Mr. Mohammed Arif and Mr. Khasim Sait with experience of around, 13
years and 13 years in the storage racking system industry.
The company's commitment to
delivering innovative and efficient solutions for diverse warehousing needs
demonstrates their commitment in its wide range of products and services. These
solutions cater to various industries such as oil & gas, automotive
components & aerospace, food & beverages, cold storage,
pharmaceuticals, textiles, retail, FMCG, and others, each with unique storage
and logistical requirements.
The Bengaluru-based company
operates with a customer-centric approach, driven by a focus on continuous
innovation and operational efficiency. It offers a comprehensive range of
display and storage racks designed for commercial and industrial purposes,
utilizing high-quality raw materials to ensure durability and optimum strength
in the finished products. These raw materials include different grades of mild
steel (hot rolled coils, cold rolled coils, galvanized steel coils, PPGI coils,
pipes, and structural sections), powder coatings for powder coating, epoxy,
enamel paints, and plastic for packaging.
The company has a manufacturing
unit that covers approximately 56,250 square feet in Singanayakanahalli,
Yelahanka Hobli, Bangalore, along with a 56,250 square feet storage facility,
supporting a streamlined manufacturing process. The company manages product
design, manufacturing, quality checking, packaging, storing, and delivery
processes across specialized segments of its infrastructure, all closely
monitored by an experienced team of quality controllers.
Through its manufacturing
prowess, competitive strengths, and strategic business approaches, Storage Technologies
and Automation Limited is well-positioned to meet the evolving needs of its
clients effectively. The company is dedicated to innovation, quality, and
delivering economically feasible solutions that exceed client expectations.
As of April 01, 2024, the total
order book value of the Company is ₹ 21.36 Crore.
Racks & Rollers - Storage Technologies and
Automation Limited has turnaround from a loss of Rs 0.20 crore in the financial
year 2022 to Rs 0.48 crore in the financial year FY23. Revenue during the year
FY23 increased 16.39% to Rs 81.32 crore from Rs 69.87 crore in the previous
year, primarily due to an increase in the business operations of the company
and increase in number of customers.
For the seven months ended October 31, 2023, revenue
from operations stood at Rs 52.92 crore, and profit after tax stood at Rs 3.59
crore.
OneView Corporate Advisors
Private Limited is the sole book-running lead. The equity shares are proposed
to be listed on SME Platform of BSE Limited.
