Successful track record, diverse customer portfolio, strategic acquisitions, emphasis on technology adoption are seen as IRM’s strong points.
MUMBAI, Oct 22 (The CONNECT) - The IPO of IRM Energy Limited was subscribed 27 times with the public issue getting support from all across the investor categories.
After getting a tremendous response from retail investors, the offering witnessed extensive bidding from qualified institutional buyers (QIBs) and non-institutional investors on Friday, the last day of the subscription.
According to the data available on the stock exchanges, the issue received bids of 20,62,70,910 equity shares against the offered 76,24,800 at a price band of ₹480-505.
Non-Institutional Investors Portion was the most subscribed with 48.34 times, followed by Qualified Institutional Buyer segment with 44.73 times. The Retail portion subscribed 9.29 times and the Employee Portion 2.05 times.
HDFC Bank Limited and BOB Capital Markets Limited are book running lead managers and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.
Company Information: IRM Energy Limited (IRMEL) has entered into a strategic and technical partnership with Shizuoka Gas Co. Ltd, the fourth largest gas company in Japan by natural gas sales volume, by infusing capital through a private placement in IRMEL. It invested in Farm Gas Private Limited, Venuka Polymers Private Limited Ni Hon Cylinders Private Limited.
The company has operations at Banaskantha (Gujarat), Fatehgarh Sahib (Punjab), Diu & Gir Somnath (Union Territory of Daman and Diu/Gujarat), and Namakkal & Tiruchirappalli (Tamil Nadu), serving 184 industrial customers, 269 commercial customers, 52,454 domestic customers, as at June 30, 2023.
Leading brokerages like SBI Securities, Nirmal Bang, Anand Rathi, BP Wealth, Hensex Securities, Indsec Securities, Marwari Financial Services, Reliance Securities, and Swastika Investment have given a subscribe rating to the issue, citing IRM Energy Ltd., a prominent player in the distribution of Compressed Natural Gas (CNG) and Piped Natural Gas (PNG), has received favourable assessments from brokerages. The company's successful track record, diverse customer portfolio, strategic acquisitions, and emphasis on technology adoption have been noted as strengths, contributing to its growth potential. Additionally, its stable financial performance, environmentally friendly fuel alternatives, and reasonable valuation relative to the industry prompted recommendations to subscribe to the IPO for potential long-term gains.
Brokerages recognize IRM Energy's position in a growing market, with a surge expected in natural gas demand, particularly in the CGD sector. The company's steady volume growth and sound operational strategies stand out, making it an attractive investment.
As of October 9, 2023, IRMEL had an established a network of 69 CNG filling stations, comprising 2 CNG stations owned and operated by the company (COCO), 36 CNG stations owned and operated by dealers (DODO), and 31 CNG stations owned and operated by oil marketing companies (the "OMC Stations").
The company’s revenue from operations increased by 6.51% from Rs 230.27 crore for the three months ended June 30, 2022 to Rs 245.25 crore for the three months ended June 30, 2023, primarily due to an increase in the sale of compressed natural gas, piped natural gas and increase in connection income and other operating revenue. Whereas, profit after tax increased by 31.01% from Rs 20.54 crore in the three months ended June 30, 2022 to Rs 26.91 crore in the three months ended June 30, 2023 due to increase in total revenue.
Revenue for fiscal 2023 grew 90.27% to Rs 1039.13 crore from Rs 546.14 crore for the Financial Year 2022 and profit after tax fell 50.68% to Rs 63.15 crore for the FY 2023 against Rs 128.03 crore in FY22, due to significant increase in input gas cost as well as due to lower profits earned by joint control entities.
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