Reblog: Shyam Metalics IPO review (Subscribe for Long Term)
- SMEL is one of the leading integrated metal producing and profit-making company.
- It has a well-diversified product portfolio in metal with the captive power plant.
- It suffered a setback for FY20 on account of expansion underway and higher provision.
- The issue is fully priced based on its financial data.
- Investors may consider an investment with a long-term perspective.
ABOUT COMPANY:
Shyam Metalics And Energy Ltd. (SMEL) is a leading integrated metal producing company based in India (Source: CRISIL Report) with a focus on long steel products and ferroalloys. It is amongst the largest producers of ferroalloys in terms of installed capacity in India, as of February 2021 (Source: CRISIL Report). The company has the ability to sell intermediate and final products across the steel value chain. As of March 31, 2020, SMEL was one of the leading players in terms of pellet capacity and the fourth-largest player in the sponge iron industry in terms of sponge iron capacity in India (Source: CRISIL Report).
The company primarily produces intermediate and long steel products, such as iron pellets, sponge iron, steel billets, TMT, structural products, wire rods, and ferroalloys products with a specific focus on high margin products, such as customised billets and specialised ferroalloys for special steel applications. Its TMT and structural products are sold under the brand ‘SEL’ and logo.
It also undertakes conversion of hot rolled coils to pipes, chrome ore to ferrochrome and manganese ore to silico manganese for an Indian steel conglomerate. The company is also currently in the process of further diversifying its product portfolio by entering into the segments, such as pig iron, ductile iron pipes and aluminium foil.