Three M Paper Boards IPO

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12th – 16th Jul 2024
22 Jul 2024
₹67 – ₹69
2000 shares (₹138000)
40cr

Schedule

Issue open date 12 Jul 2024
Issue close date 16 Jul 2024
UPI mandate deadline 16 Jul 2024 (5 PM)
Allotment finalization 18 Jul 2024
Refund initiation 19 Jul 2024
Share credit 19 Jul 2024
Listing date 22 Jul 2024
Mandate end date 31 Jul 2024
Lock-in end date for anchor investors (50%) 18 Aug 2024
Lock-in end date for anchor investors (remaining) 18 Oct 2024

About

Incorporated in 1989, Three M Paper Boards is engaged in manufacturing recycled paper-based Duplex Board products used in various packaging applications across industries such as food and beverage, pharmaceuticals, cosmetics, and consumer goods. The company’s products are made out of 100% recycled waste paper and are completely biodegradable.

The Company is headquartered in Mumbai and operates a manufacturing facility in Chiplun, District Ratnagiri, Maharashtra. At the close of FY 2023–24, the Company had a total manufacturing capacity of 72,000 TPA of paper. The Company has a strong Pan-India distribution network of around 25 dealers and has also exported its products to over 15 countries in the Asia-Pacific, Middle East, the Mediterranean, and African regions.


Financials



Issue size

Funds raised in the IPO Amount
Overall ₹39.83 crores
Fresh issue ₹39.83 crores
Offer for sale

Utilisation of proceeds

Purpose INR crores (%)
Capital expenditure 14 (37.8%)
Working capital 10 (27%)
Debt reduction 7 (18.9%)
General corporate purposes 6 (16.3%)

*All figures except EPS are in ₹ crores

Strengths

  • In-house core competency in pulp & paper: The company has been a key player in the pulp and paper industry for over three decades. All production processes are managed internally, without any reliance on outsourcing, thereby guaranteeing consistent quality and reliability.
  • Cost efficiency through in-house coal-based power generation: The company operates a 4 MW captive power plant, substantially lowering electricity expenses compared to purchasing power from external distributors. This self-sufficiency provides a more stable and cost-effective energy source for its operations.
  • Extensive network of dealers and customers: The company boasts a comprehensive dealer network across India, with approximately 25 dealers. This robust distribution channel allows them to effectively service nationwide markets, ensuring wide-reaching customer access.

Risks

  • Clientele risk: The company relies on its top 10 clients for over 45% of its revenue. Losing any of these major customers could negatively impact revenue and profitability.
  • Geographical concentration risks: With operations primarily concentrated in Maharashtra, Karnataka, Goa, and Delhi, where more than 75% of revenue is generated, any adverse developments affecting these regions can pose significant operational risks.
  • Dependence on imports for raw materials: The company sources its key raw material, waste paper, from regions such as the U.S., U.K., Central Europe, and the Middle East. Overdependence on these imports, coupled with a lack of alternative arrangements from Indian suppliers, could jeopardize profitability if trade relations with these countries deteriorate or if suppliers face internal issues in their respective nations.

Note:

  • The above schedule is tentative. The anchor lock-in period ends 30 days after the actual allotment date for 50% of the shares and 90 days after for the remaining portion.
  • The allotment status will be available by July 19, 2024, on the registrar’s website and the NSE website.