The year 2015 saw multiple IPO offerings in the country, and one of those was IPO of Mughal Iron and Steel Industries. The excitement in the market was quite evident from the get-go. For once, the market was seeing not one, but two steel giants of the country offered the IPO.
Mughal planned to utilise the proceeds to acquire 7.5 MW induction furnaces, replacing, maintaining and reconditioning the manufacturing facilities it has. The company also wants to use the proceeds for the acquisition of induction furnace and BMR of the re-rolling mill.
The IPO of Mughal as expected was oversubscribed by over three times in the book-building process, and that happened in a matter of minutes. This shows the immense desire and interest of people to get their hands wet with the fortunes as the company offered a band in the range of Rs 20-34, and the investors offered a bid of Rs 34 per share.
The issue has consisted of 27.35 million ordinary shares, representing 25 percent of post issued paid-up capital. However, the general public was being offered 6.83 million shares or 25 percent of the issue at a premium of Rs 24 to the face value.
Company Profile:
Mughal Iron & Steel Industries Limited ("MISIL") is one of the leading businesses in Pakistan in the iron and steel sector. The company was incepted in early 1950 in the form of a proprietorship firm, and the business was incorporated in 2010.
The company is actively involved in multidimensional activities from making billets of Mild Steel, Spring Steel, Deformed bar, Re-bar, Cold Twisted Rebar and an enormous range of Sections such as I. Beams, L. Sections, C. Sections, H. Beams, T. Bars in the downstream industry.
Over the years, Mughal Steel has emerged as a serious player in the industry and rather quickly transforms itself into a strong contender in the iron and steel sector to become the largest manufacturer of long rolled iron and steel products in Pakistan. The firm is an export-oriented entity with the strong market presence in the neighbouring country, Afghanistan.
The Capacity of the Company:
To expand its capacity, Mughal Steel took over plant and machinery from Al-Bashir Steel Industries in 2008. It also installed an additional mini-sectional mill. After being incorporated, it added bar re-rolling capacity of 150,000 MT. Again in 2011, it added 300,000 MT of production capacity. In 2014, Mughal installed a couple of new induction furnaces of 7.5MW and 6MW. At the same time to improve its efficiency, it introduced a continuous casting machine (CCM).