Pyramid Technoplast Limited IPO

About the company:

Pyramid Technoplast Limited was incorporated on December 30, 1997. Pyramid Technoplast is an industrial packaging company engaged in the business of manufacturing polymer-based molded products (Polymer Drums) mainly used by chemical, agrochemical, speciality chemical and pharmaceutical companies for their packaging requirements. They are one of the leading manufacturers of rigid Intermediate Bulk Containers (IBC) in India manufacturing 1,000-litre capacity IBC. They also manufacture MS Drums made of mild steel (MS) used in the packaging and transport of chemicals, agrochemicals and speciality chemicals.

Objects of the Offer:

The company intends to utilize the net proceeds from the fresh issue towards the following objects:
- Repayment and/or pre-payment, in full or part, of certain outstanding borrowings availed by the company
- Funding working capital requirements of the company and
- General Corporate Purposes

Key Strengths and Opportunities:

- Pyramid Technoplast caters to bulk packaging requirements from diverse industries like chemicals, agrochemicals, pharmaceuticals, lubricants and edible oil by supplying them Polymer Drums, IBC and MS drums. The company enjoys long-term relationships with most of its clients and the repeat businesses allow it to have strong visibility on future revenues and a stable client base.

- The company offers complete bulk industrial packaging solutions to its clients as they manufacture both polymer-based bulk packaging drums and IBC, as well as MS Drums for packaging.

- The company’s six manufacturing units out of which four are situated at Bharuch, GIDC, Gujarat and two units are situated at Silvassa, UT of Dadra and Nagar Haveli which are manufacturing hubs for various industries like chemicals, agrochemicals, pharmaceuticals, lubricants, edible oil, etc. Proximity to these industries enables easy accessibility and delivery of our products to these industries in these industrial regions.

- The company is led by qualified and experienced individual Promoters and senior management team, that has the expertise and vision to manage and grow their business. The promoters, Bijaykumar Agarwal and Jaiprakash Agarwal have a cumulative experience of over 4 decades in the industry and have been instrumental in the company’s growth and development.

Risks:

- The company’s manufacturing units are situated in the State of Gujarat, Maharashtra and the Union Territory of Dadra and Nagar Haveli. The company also sells its products in the western part of India around these regions. Any economic slowdown in this part or a natural disaster or constraints on the company’s ability to diversify across other states could hamper the company’s future growth.

- The company’s business growth, operations and financials may be affected if the company is not able to adhere to a change in government policies or quality norms by its customers for molded industrial packaging. Pyramid Technoplast derives a substantial part of its revenue from molded industrial packaging product vertical. It is required to adhere to government policies, international standards or customer quality norms for 31 manufacturing industrial packaging products. These standards are subject to certain changes as may be required by the chemical, pharmaceutical and other industries from time to time.

- The company does not have an experienced Board as none of the Board of Directors have been directors on the Board of a listed company.

- The company derives a substantial portion of its revenues from the manufacturing of polymer-based molded industrial packaging products like Polymer Drums and Intermediate Bulk Containers (IBC).

Financial Snapshot: