The shares of Hariom Pipe Industries gained 17.67% to reach a fresh 52-week high (record high) of ₹ 403.55 apiece on the National Stock Exchange (NSE). Its shares were trading at 392.45 apiece at 12:24 PM on Wednesday. 

The company in a stock exchange filing said that it had entered into an asset transfer agreement with R.P.Metal Sections Private Limited on 26th December, 2022 to purchase its operating asset which manufactures galvanised pipe and cold roll coil, for a consideration of ₹ 55 crores in cash. 

This unit is spread across 13.83 acres of land and is located at SIPCOT Industrial growth centre, Perundurai, Tamil Nadu. Hariom Pipes said that it is in the process of expanding its product range to add more value-added products, and the acquisition of these operating assets will help it achieve the same. 

R.P.Metal Sections Private Limited will have to take approval from SIPCOT (State Industries Promotion Corporation of Tamil Nadu) to transfer the lease agreement in the name of Hariom Pipe Industries and all other transfer of licences. 

Hariom Pipe Industries Limited is an integrated steel manufacturer with a stronghold in the South Indian market. Its product portfolio includes mild steel (MS) billets, pipes and tubes, hot rolled (HR) coils, and scaffolding systems. The company already has two manufacturing facilities located in Telangana and Andhra Pradesh. 

It is a small-cap company with a market capitalization of ₹ 874 crores. It has an excellent return on equity of 37.20% and an ideal debt-to-equity ratio of 0.34. However, its shares are trading at a price-to-equity ratio of 20.37, which is much higher than the industry average of 10.54, indicating that it might be overvalued as compared to its peers. 

Hariom Pipe Industries got listed on April 13, 2022. Its shares were issued at an upper price band of ₹ 153, and the current share price of ₹ 392.45 indicates that the shares have given multibagger returns of 156.50%. Therefore if an investor would have invested ₹ 1 lakh in the company’s shares during the IPO, the value of their holdings would have been ₹ 2.56 lakh today! 

Written by Simran Bafna 

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