Sharvaya Metals Limited IPO Analysis
Company Overview
Sharvaya Metals Limited is an aluminium products manufacturer established in 2014, offering a comprehensive range of aluminium products including alloyed ingots, billets, sheets, circles, and EV battery housing components. The company serves diverse industries including cookware, consumer appliances, electric vehicles, aviation, defence, and construction.
Key Highlights:
- 11 years of experience in aluminium manufacturing
- Diversified product portfolio across multiple industries
- Manufacturing facility in Ahmednagar, Maharashtra with R&D laboratory
- Growing presence in EV battery components segment
- IPO Size: ₹55.86 Crore
Manufacturing Capacity Utilization
| Product Category | Capacity (per annum) | Utilization Rate |
|---|---|---|
| Aluminium Alloyed Ingots and Scrap | 3,500 MT | 31.74% |
| Aluminum Billets | 500 MT | 55.00% |
| Aluminum Sheet and Circles | 500 MT | 1.20% |
| EV Components & Extruded Products | 300 MT | 54.00% |
| Aluminum Extrusion Dies | 1,000 Nos | 13.50% |
Financial Performance Trend Analysis
| Metric | FY25 | FY24 | FY23 | 2-Yr CAGR | FY24-FY25 YoY | FY23-FY24 YoY |
|---|---|---|---|---|---|---|
| Total Income (Cr) | 112.76 | 71.58 | 70.53 | 26.37% | 57.53% | 1.49% |
| PAT (Cr) | 12.51 | 1.54 | 1.95 | 154.71% | 712.34% | -21.03% |
| EBITDA (Cr) | 19.30 | 3.56 | 3.37 | 139.52% | 442.13% | 5.64% |
| Net Worth (Cr) | 22.78 | 7.63 | 6.09 | 93.57% | 198.56% | 25.29% |
Exceptional Revenue Growth: Total Income grew from ₹70.53 Cr (FY23) to ₹112.76 Cr (FY25), representing a strong 2-year CAGR of 26.37%. FY25 showed explosive 57.53% YoY growth after modest growth in FY24.
Remarkable Profitability Transformation: PAT surged dramatically from ₹1.95 Cr (FY23) to ₹12.51 Cr (FY25) with an extraordinary 2-year CAGR of 154.71%. FY25 PAT grew 712.34% YoY, indicating a significant operational turnaround. Margins improved substantially with PAT Margin at 11.12% and EBITDA Margin at 17.16%.
Peer Comparison
| Metric | Sharvaya Metals | Maan Aluminium | Manaksia Aluminium | Baheti Recycling |
|---|---|---|---|---|
| EPS (Basic) | 17.08 | 2.87 | 0.92 | 17.37 |
| RoNW | 54.92% | 4.97% | 4.47% | 40.79% |
| P/E (x) | N/A | 41.00 | 33.18 | 31.65 |
Sharvaya Metals demonstrates exceptional return ratios compared to peers with RoNW of 54.92%, significantly higher than all competitors including Baheti Recycling at 40.79%. The company’s EPS of 17.08 is comparable to Baheti Recycling but substantially higher than other peers.
Subscription Status & Market Sentiment
| Category | Subscription (times) |
|---|---|
| QIB | 0.90x |
| NII | 2.49x |
| Retail | 4.28x |
| Total | 2.93x |
The IPO received moderate investor interest with overall subscription of 2.93 times, by ~4 pm on Day 1, led by retail investors at 4.28x. The Grey Market Premium (GMP) of ₹8 (4.08% over IPO price) indicates cautious investor sentiment. The estimated listing price of ₹204 suggests potential for modest listing gains.
Strengths
- Exceptional profitability growth (712% YoY PAT growth)
- Outstanding return ratios (ROE 54.92%, ROCE 49.39%)
- Diversified product portfolio across growing industries
- Presence in high-growth EV components segment
- Significant capacity available for future expansion
Concerns
- Low institutional investor interest (QIB: 0.90x)
- Uneven capacity utilization across product categories
- Modest GMP indicating cautious market sentiment
- Cyclical nature of metals industry
- Dependence on industrial and automotive sectors
Final Recommendation
Weighted Score: 7.5/10
Sharvaya Metals presents a compelling growth story with exceptional financial performance and strong positioning in the aluminium products market. The company’s remarkable profitability transformation, outstanding return ratios, and diversified product portfolio are significant strengths. However, the modest subscription response and low institutional interest warrant caution.
Recommendation: CAUTIOUS APPLY for investors with moderate risk appetite. The company’s strong fundamentals and growth potential are attractive, but the limited institutional interest and modest GMP suggest a measured approach. Suitable for investors seeking exposure to the industrial metals and EV components sector.
Note: Metals industry is cyclical and dependent on industrial demand, but the company’s diversification into EV components provides growth opportunities.
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