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Sandur Manganese RI review (Apply)

The Sandur Manganese & Iron Ores Limited Logo

•    SMIOL is a private sector mining company producing iron ore.
•    It has a good financial track record except for FY21 (a pandemic year).
•    At par right issue is a "Mini Bonus" from this company.
•    A golden opportunity to grab shares at par value in a dividend-paying company.

ABOUT COMPANY: 
The Sandur Manganese & Iron Ores Ltd. (SMIOL) was incorporated with a vision to develop the manganese and iron ore mines in a scientific manner. Over the decades, the Company's operations have expanded to cover mining, and downstream facilities of ferroalloy, coke and energy. The Company believes in integrating across its value chain and consolidating its business, to ensure that the Company adds value in each stage and the operations are complementary to each other.

The Company is a private sector merchant miner and commodity producer with an operational track record spanning nearly seven decades. The cornerstone of its business still lies in environmentally friendly, systematic, safe and scientific mining. The Company believes it is one of the largest Manganese Ore miners in India. The Company is engaged in the mining of manganese and iron ores in the Deogiri village of Sandur taluk, Bellary District, Karnataka. The Company is also engaged in the manufacture of ferroalloys & coke.

At present, the Company's operations span over three business segments i.e., Mining (Manganese & Iron Ores), Ferroalloys and Coke & Energy. Together, these assets work in conjunction with each other to leverage the benefits of being an integrated Company in the metals and mining industry. As on 31 March 2022, the Company has 2288 permanent employees on the rolls and 852 on contracts.

ISSUE DETAILS:
To part finance its needs for investment in the proposed SPV - Renew Sandur Green Energy Pvt. Ltd. (Rs. 17.50 cr.), SMIOL is coming out with a right issue (RI) of 18003882 equity shares of Rs. 10 each at par value to mobilize Rs. 18.00 cr. The company is issuing RI in the ratio of 2 shares against 1 share held by the eligible stakeholders as of the record date i.e. July 27, 2022. The issue opens for subscription on August 08, 2022, and will close on August 29, 2022. The full amount is payable on the application. Post allotment, shares will be listed on BSE. The company is spending Rs. 0.50 cr. for this RI process. 

The issue is solely lead managed by Finshore Management Services Ltd. and Venture Capital & Corporate Investments Pvt. Ltd. is the registrar to the issue.

Post RI, SMIOL's current paid-up equity capital of Rs. 9.00 cr. will stand enhanced to Rs. 27.01 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 27.01 cr.

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, SMIOL has posted turnover/net profits of Rs. 764.36 cr. / Rs. 153.93 cr. (FY21) and Rs. 2283.97 cr. / Rs. 675.11 cr. (FY22). 

As of March 31, 2022, its current paid-up equity capital of Rs. 9.00 cr. is supported by reserves worth Rs. 1650.00 cr. 

DIVIDEND POLICY:
The company is a dividend-paying company with the last dividend paid at 100% in September 2021. It will adopt a prudent dividend policy post listing of RI, based on its financial performance and future prospects. 

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 504918:
The scrip last closed on cum-right basis at Rs. 3116.65 on July 25, 2022, and opened on an ex-right basis at Rs. 1107.00 on July 26, 2022. Since then it has marked a high/low of Rs. 1232.00 / Rs. 990.00. The scrip last closed at Rs. 1019.45 as of August 04, 2022. Based on this quote, its post-RI market cap stands at Rs. 2753.11 cr. The scrip has posted the last 52 weeks high/low of Rs. 1700.13 / Rs. 519.59 (post adjustment of Ex-RI impact). Promoters holding is around 73.2% for last three quarters. The counter is operating well with the current quote above Rs. 1000 per share.


Conclusion / Investment Strategy

The oldest private sector mining and iron ore producing company has strong financial data except for FY21 (a pandemic year). It’s at par rights issue is termed as a “Mini Bonus”. Eligible investors should not miss this golden opportunity to have fresh investment at a par level in a dividend-paying company.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on Aug 4, 2022

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at its own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda, a freelance journalist

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

More The Sandur Manganese & Iron Ores Limited RI Views / Analysis / Recommendations ...

The The Sandur Manganese & Iron Ores Rights Issue 2022 Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered Rights Issue Analysts tells you if The Sandur Manganese & Iron Ores Rights Issue 2022 worth investing. The The Sandur Manganese & Iron Ores Rights Issue 2022 Note sets the Rights Issue expectations in systematic way which tells you if The Sandur Manganese & Iron Ores Rights Issue 2022 good to buy (good or bad / yes or no). The Rights Issue Forecast tells you weather to invest in The Sandur Manganese & Iron Ores Rights Issue 2022 by providing Rights Issue recommendations i.e. subscribe, avoid and neutral.


8 Comments

8. Rakesh   I Like It. | Report Abuse |   Link | Sep 7, 2022 10:43:29 AM Reply
Right issue kab demat m milenge?? allotment kab hogi?
7. Rakesh   I Like It. | Report Abuse |   Link | Sep 7, 2022 10:42:01 AM Reply
Right issue kab demat m milenge?? allotment kab hogi?
6. VAGEESH   I Like It. | Report Abuse |   Link | Aug 19, 2022 2:00:00 PM Reply
Please drop an email to the Company, Lead Manager and Registrar for online payment facilities with all Banks .
investor.relations@vccipl.com and investors@sandurgroup.com and ramakrishna@finshoregroup.com

I have sent an email to all three .
5. Y.M.JOSHI   I Like It. | Report Abuse |   Link | Aug 11, 2022 2:42:18 PM Reply
No LINK provided for online applying.
Tried to contact on given phone lines for 2 days all through the day the primary line is busy and the supporting lines are not at all answered.
CAN YOU CONFIRM IF RIGHTS ARE TO BE CLAIMED THROUGH PHYSICAL APPLICATION ONLY ? OR THERE IS A ONLINE FACILITY AS WELL ? IF SO PLEASE PROVIDE DETAILS.
***REQUEST TO RESPOND SETTING ASIDE **30 DAYS MANDATE AS IT WOULD NOT SERVE PURPOSE.
5.1. S.N. Basrur   I Like It. | Report Abuse |   Link | Aug 12, 2022 11:17:58 AM
Hi... If u hv IDBI bank account online... u can apply through it... go to investment and clik right issue... else yes through physical form filling .. NO CLEARITY
4. sanjay   I Like It. | Report Abuse |   Link | Aug 11, 2022 12:36:54 PM Reply
What is the link to apply for Sandur RI online? It says to use ragistar's website where I did not get the place to apply for RI.