Hariom Pipe hits new high, up 4% on shareholders nod for preferential issue

In past three months, the stock has zoomed nearly 50 per cent, as compared to 5 per cent decline in the S&P BSE Sensex.

Shares of Hariom Pipe Industries (HPIL) hit a record high of Rs 481.15 as they rallied 4 per cent on the BSE in Tuesday’s intra-day trade in an otherwise range-bound market after getting shareholders nod for raising funds via issue of preferential shares.

The stock of iron & steel products maker surpassed its previous high of Rs 468, touched on March 14, 2023. In past three months, it has zoomed nearly 50 per cent, as compared to 5 per cent decline in the S&P BSE Sensex. Further, in past six months, it skyrocketed 80 per cent, as against 3 per cent fall in the benchmark index.

The market price of the company has zoomed 214 per cent from its issue price of Rs 153 per share. HPIL made its stock market debut on April 13, 2022.

HPIL said the shareholders approved issue of up to 3.37 million warrants each convertible into, or exchangeable for, one equity share of the company within the period of 18 (eighteen months) and issuance of up to 2.14 million equity shares of Rs 10 each of the company on a preferential basis to specified person(s) under promoter / promoter group of the company and certain identified non-promoter persons.

The board of directors of HPIL at their meeting held on January 25, 2023, had already approved to raise total amount of Rs 190.27 crore via issue of warrants (Rs 116.30 crore) and equity shares (Rs 73.97 crore) at a price of Rs 345 per share.

HPIL is one of the most backward integrated steel pipe mill companies, wherein HPIL manufactures sponge iron, billets, HR strips and pipes.

In the month of December 2022, the company entered into an asset transfer agreement with R.P.Metal Sections Private Limited to acquire an operating galvanized pipe mill plant at Perundurai in Tamil Nadu which will add to capacities, expand the product basket and also spread the geographical reach of the company. The initial positive impact of this acquisition will be visible from the Q4 of the current financial year and a full impact would be visible from the financial year 2023 -24 (FY24) onwards.

The company is also setting up a modern cold rolled steel mill and a galvanized pipe manufacturing plant near Hyderabad and the complete benefits of these expansions and capex would be visible in the FY24 onwards.

HPIL said it will strive to grow both horizontally and vertically in terms of geography, product basket expansion, value added products and a quick turnaround time in its supply chain and meeting its customers’ demands.

Being one of the most backward integrated steel pipe mill companies, wherein HPIL manufactures sponge iron, billets, HR strips and pipes, the company is confident to stand out within the industry and continue to deliver healthy margins going forward, it added.