Hira Ferro Alloys Share price | IPO Date Review

Hira Ferro Alloys Unlisted Shares

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Hira Ferro Alloys Essentials

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ISIN

INE573I01011

Face Value

₹10.00

Total Share

1,95,88,500

Total Income

₹31,697.39 L

Profit After Tax

₹2,113.73 L

EPS

₹10.79

P/E

16.96

P/B

1.97

Market Capitalisation

₹358.47 Cr

Enterprise Value

₹387.99 Cr

Book Value

₹93.12

Intrinsic Value

₹335.51

Earnings Yield

5.90 %

Sector

Materials

Sub-sector

Iron & Steel

Hira Ferro Alloys Growth

Compounded Sales Growth

4.21%

1 Year
9.27%

5 Year
0.76%

9 Year

Pro Only

Compounded Profit Growth

452.16%

1 Year
54.93%

5 Year
17.82%

9 Year

Pro Only

Return On Equity

11.59%

2021
2.35%

2017
3.10%

2013

Pro Only

About Hira Ferro Alloys

Hira Ferro Alloys Ltd. (HFAL) has created its identity as a manufacturer of Ferro Alloys, Power, Briquette and Fly Ash Bricks. Hira Ferro Alloys Limited manufactures and sells ferro alloys, briquette, and fly ash bricks in India. It operates through Ferro alloys, Power, and Trading of Goods segment. The company offers manganese based ferro alloys, which are used in steel making and refining activities. It is also involved in the generation of electricity. The company’s power generation capacity includes 20 MW of thermal; 8.5 MW of the biomass; and 1.5 MW of windmill energy.
This company is based in Urla, Chhattisgarh. It was established in 1990 with 5.0 MVA (SAF) to produce 7200 TPA equivalent of Silicomanganese. Its Installed capacity is 26.6 MVA equivalents of 61500 TPA of Ferromanganese while power generation capacity is 20MW for thermal, 8.5 MW for the biomass base plant and 1.5MW for windmill energy that makes one third of the green energy produced.

HFAL is a certified ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007 company, which is a venture by one of the prime steel manufacturing groups, The Hira Group of industries. The Hira Group started the production of Ferro Alloys through small electric furnace route and expanded its process by establishing Hira Ferro Alloys Ltd. It later installed two steel rolling mills followed by sponge iron and power plants as well as a coal beneficiation unit. Soon it ventured into high definition integrated iron, steel manufacturing plants and power generating units.
Hira Ferro Alloys Limited was incorporated in 1984 and is based in Raipur, India. Hira Ferro Alloys Ltd. operates as a subsidiary of Godawari Power & Ispat Limited.

Hira Ferro Alloys IPO Details

The Board of Directors of HFAL had stepped forward for voluntary delisting of 19588500 equity shares of 10/-each fully paid up from BSE Limited (BSE) and Madhya Pradesh Stock Exchange Limited (MPSE) on 8th February, 2014. Currently, the company is not planning to raise funds through IPO.

Hira Ferro Alloys Merger & Acquisition

Acquisition

On 21st March 2022, Godawari Power & Ispat Limited signed a share purchase agreement to acquire an additional 19.2% stake in Hira Ferro Alloys Ltd. from HIRA Infra-Tek Limited for Rs. 99.78 Cr. As part of the transaction, Godawari Power & Ispat will acquire 4,454,621 equity shares at a price of Rs. 224 per share, totalling Rs. 99.78 Cr. Post completion, Godawari Power & Ispat's holding in Hira Ferro Alloys will increase from 56.45% to 75.66% stake.
on July 27, 2021, Godawari Power & Ispat Limited agreed to acquire an additional 8% stake in Hira Ferro Alloys Ltd. for approximately Rs. 70.20 Cr. The consideration was paid in cash. The proceeds from the transaction will be used to finance the 70 MW Solar Power Plant in Rajnandgaon, Chhattisgarh. This transaction features minority shareholder increasing ownership stake in the Hira Ferro Alloys.
On March 31, 2016, Vinay Buildcon Private Limited acquired 2.81% stake in Hira Ferro Alloys Ltd. from Godawari Power & Ispat Ltd. for Rs. 1.76 Cr. Godawari Power sold 5.5 lakhs shares of Hira Ferro Alloys at a price per share of Rs. 32. Following the completion of the deal, Godawari Power & Ispat holds 48.5% stake in Hira Ferro Alloys.
On May 15, 2014, Hira Infratek Pvt Ltd made a delisting offer to acquire 27.56% stake in Hira Ferro Alloys Ltd. for approximately Rs. 12 Cr. As of May 15, 2014, The Board is ready to accept offer at Rs. 21.5 per share. Post transaction, Hira Infratek and the promoters will hold 100% stake in Hira Ferro Alloys and will delist the company.
On April 5, 2011, Hira Ferro Alloys Ltd. signed a definitive agreement to acquire 8.5 MW Bio-Mass Power Plant situated at Village Belsonda, Dist Mahasamund, Chhattisgarh from M/s Shivalik Power and Steel Pvt Ltd. for Rs. 10 lakhs.
On March 4, 2008,Hira Industries Ltd. made an offer to acquire an additional 20% stake in Hira Ferro Alloys Ltd. for Rs. 9.40 Cr. in cash . Hira Industries will pay Rs. 120 per Hira Ferro Alloys share and will acquire 7.8 lakhs Hira Ferro Alloys shares. Upon completion of the acquisition Hira Industries will own a 40.11% stake in Hira Ferro Alloys.
On February 22, 2008, Hira Industries Ltd. acquired an additional 19.27% stake in Hira Ferro Alloys Ltd. from ETP Corporation Limited for Rs. 5.28 Cr. in cash. Hira Industries acquired 7.6 lakhs Hira Ferro Alloys shares at Rs. 70 per Hira Ferro Alloys share.

Investments

On 17th March, 2021, the company has acquired 20% equity stake in Xtratrust Digisign Private Limited (Xtratrust) as a result of which this company has become associate of the company. Xtratrust has been incorporated with an object of entering into the business of providing Digital Signatures.
On 25th February, 2021, the company has acquired 100% equity stake in Spring Solar Power Private Limited (Spring Solar) as a result of which this company has become wholly owned subsidiary of the company. Spring Solar has been incorporated with an object of setting up of Solar Power Plant.

Hira Ferro Alloys Subsidiaries

Associate company

Xtratrust Digisign Private Limited

Subsidiary company

Spring Solar Power Private Limited

Hira Ferro Alloys Business Model

Hira Ferro Alloys primarily operates as a ferro alloy manufacturer, which mostly includes the production of bulk alloys, mainly ferromanganese and silicomanganese, which are sold domestically. It also manufactures fly ash brick and manganese ore briquettes.
The company is in the business of generating power through various plants, including wind, thermal, and biomass power plants, from which it generates revenue.

Hira Ferro Alloys Revenue Segmentation

Manufacturing Goods
Other Income

Power Generation
Traded Goods

Other Operating Income

Hira Ferro Alloys Product & Services

Ferro Alloys
Power
Thermal
Wind Mill
Biomass
Fly Ash Bricks (ISI Mark)
Mn. Ore Briquettes

Hira Ferro Alloys Assets

The company's assets as on 31st, March 2021

Particulars	(Amount in Rs. Lakhs)
Freehold Land	386
Leasehold Land	54
Site & Land Development	209
Factory Shed & Building	1093
Plant & Machinery	7689
Furniture & Fixtures	58
Vehicles	186
Computer Software	0.2

Hira Ferro Alloys Industry Overview

Industry Statistics

Ferroalloys are one of the important inputs in the manufacture of alloys and special steel. They are used as deoxidisers and alloy additives in the steel manufacturing process. They impart special properties to steel. The alloys provide increased resistance to corrosion, improve hardness & tensile strength at high temperature.
Ferroalloys are classified into two main categories, viz, bulk ferroalloys and noble ferroalloys. Hira Ferro Alloys operates as manufacturer of bulk ferroalloys. Bulk ferroalloys is majorly used in stainless steel & carbon steel.
As per Indian Ferroalloys Producers' Association (IFAPA), the total installed capacity of bulk Ferroalloys Industry in India is estimated at 5.10 million tonnes per annum and for noble ferroalloys it is 50,000 tonnes per annum in 2021.
The global ferroalloys market size was valued at USD 42.7 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 7.1% from 2021 to 2028 as per Grandview research. Incessant production of steel around the world is projected to benefit market growth.
Ferroalloys Industry has not been operating to its full capacity in India. Ferroalloys Industry spends 40 to 70% production cost on power consumption. The power consumption per tonne of ferroalloys production in the country varied from 3,000 to 12,000 kWh.
Rising production capacities to meet the steel production are projected to increase the competition in the market. One of the major drivers for the ferroalloys market growth is the rising demand for steels from end-user industries like construction, shipbuilding, automotive, and several other sectors. The material has significant applications in steel products such as stainless steel, alloy steel, carbon steel, etc.
Prominent players in ferroalloys industries are SAIL and Jindal Group.

Future Prospects

As per Indian Steel Association (ISA), steel demand will grow by 7.2% in 2019-20 and 2020-21.

Huge scope for growth is offered by India’s comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile and railways sectors. The availability of iron ore in abundance throughout the globe, together with the increased demand for the different types of steel grades as a result of the lack of feasible alternatives, would provide a boost to the ferroalloys market in the forecast period. The rise in the population, together with the increase in living standards, also boosts the construction sector, further aiding the ferroalloys market. Recent government measures to improve the manufacturing sector in the Asia Pacific region is expected to propel the ferroalloys market over the forecast period.
The National Steel Policy 2017 has envisaged achieving up to 300 MT of production capacity by 2030-31. Expansion of production capacity to 300 MT will translate into additional investment of Rs 10 lakh crore (US$ 156.08 billion) by 2030-31, which is further expected to increase the demand of ferroalloys.

Government Initiatives

The Indian Ferro Alloy Producers’ Association (IFAPA) is an apex body representing manufacturers of Bulk and Noble Ferro Alloys in the country. The Ferro Alloys Industry was established during the second five year plan as an ancillary industry to cater to the growing needs of the domestic Steel Industry.
Under the Union Budget 2020-21, the government allocated Rs. 39 cr. to the Ministry of Steel. The budget’s focus is on creating infrastructure and manufacturing to propel the economy. In addition, enhanced outlays for key sectors such as defence services, railways, and roads, transport and highways would provide impetus to steel consumption.

In January 2021, the Ministry of Steel, Government of India, signed a Memorandum of Cooperation (MoC) with the Ministry of Economy, Trade and Industry, Government of Japan, to boost the steel sector through joint activities under the framework of India–Japan Steel Dialogue.
The National Steel Policy, 2017 envisage 300 million tonnes of production capacity by 2030-31. The per capita consumption of steel has increased from 57.6 kgs to 74.1 kgs during the last five years. The government has a fixed objective of increasing rural consumption of steel from the current 19.6 kg/per capita to 38 kg/per capita by 2030-31.

Hira Ferro Alloys Strengths

As per India Bureau of Mines, Ferroalloys industry spends 40 to 70% production cost on power consumption. Whilst, Hira Ferro Alloys generates power using its own wind, biomass and thermal plant, which makes the company self sufficient and sets apart from rest of the companies in the segment.
The company has been able to consistently increase its production capacity year-on-year (y-o-y), which makes the company reaches economies of scale.

Hira Ferro Alloys Shortcomings

India is the net exporter of the ferroalloys and conversely the company has no footprints outside India.
The company did not make any investments for technology absorption or import any technology that is essential for the company in the segment.