Standard Glass Lining Technology IPO to Raise Rs 410.05 Crore: Details Inside

Objectives of IPO

The company intends to allocate the net proceeds from the issue towards the following purposes:

• Supporting capital expenditure for acquiring machinery and equipment.
• Repaying or partially prepaying outstanding borrowings, including those of its wholly-owned subsidiary, S2 Engineering Industry Private Limited, from banks and financial institutions.
• Investing in S2 Engineering Industry Private Limited to fund its capital expenditure needs, particularly for the purchase of machinery and equipment.
• Pursuing inorganic growth through strategic investments or acquisitions.
• Meeting general corporate expenses.

Standard Glass Lining's Financial Performance

Standard Glass Lining delivered a strong financial performance in FY2024, with notable revenue growth, improved profitability, and operational efficiency. The company benefited from strategic investments and rising market demand, which contributed to its positive results. Its revenue increased by 10%, and profit after tax (PAT) grew by 12%. Additionally, Standard Glass Lining is recognized as one of the top 5 specialized engineering component manufacturers in India for the pharmaceutical and chemical sectors based on FY24 revenue, further strengthening its position in the industry.

About the Company

Established in September 2012, Standard Glass Lining Technology Limited specializes in producing advanced engineering equipment tailored for India’s pharmaceutical and chemical industries. With comprehensive in-house production capabilities, the company delivers end-to-end solutions.

From design and engineering to manufacturing, assembly, installation, and standard operating procedures, the company offers turnkey services designed to meet the diverse needs of pharmaceutical and chemical manufacturers.

The major competitors include:

• GMM Pfaudler Ltd.: A leading manufacturer known for its extensive range of glass-lined equipment.
• HLE Glascoat Limited: Specializes in glass-lined reactors and other related equipment.
• Thermax Ltd.: Offers a wide array of engineering solutions, including those for the energy and environment sectors.
• Praj Industries Ltd.: Focuses on bioprocessing and engineering solutions, including equipment for the beverage and biofuel industries.

Strengths

• In-House Capabilities: SGL has full in-house capabilities across the entire value chain, from design and engineering to manufacturing and installation, which enhances operational efficiency and product quality.
• Industry Leadership: The company is recognized as one of the top five specialized engineering equipment manufacturers for the pharmaceutical and chemical sectors in India, particularly in glass-lined and stainless steel equipment.
• Strong Client Relationships: The company has established long-term relationships with major clients like Aurobindo Pharma and Cadila Pharmaceuticals, which reflects its reliability and reputation in the industry.

Weaknesses

• Market Competition: In a highly competitive market with several established peers, SGL faces ongoing pressure to innovate and maintain its market position against rivals like GMM Pfaudler Ltd. and HLE Glascoat Limited.
• Geographic concentration: The company operates through its eight manufacturing facilities located in Hyderabad. This geographic concentration poses a risk, as adverse economic or political conditions in the region could negatively impact product demand.

Negative Cash Flows: The company has reported net negative cash flows in certain periods, raising concerns about liquidity and financial health during those times.