00:00The company's tagline is,
00:02Make every customer a repeat customer.
00:04And historically, our export has been above 50% on an average.
00:09Maximum, those EPC and OEMs are our customers.
00:14Thermex is one of our oldest customers.
00:17We have never had a shortage of orders.
00:20The mood and atmosphere of the share market is very good.
00:23The market is trading at an all-time high.
00:25Along with the equity market,
00:26we are also seeing sharp action in the primary market.
00:29One after the other, IPOs are opening up.
00:31In this period, the IPO of DEE Piping Systems is also ready to open.
00:36The IPO will open from 19th June.
00:38This company is an engineering company,
00:41which provides specialized process piping solutions.
00:45In terms of installed capacity,
00:46it is the leading company in the country.
00:48We will talk about this today.
00:50The company wants to raise Rs. 418 crores through a public issue.
00:54There will be a fresh issue of Rs. 325 crores.
00:57The amount will be raised through an offer for sale.
01:01Promoters will also sell their stakes.
01:03The price band is fixed at Rs. 193 to Rs. 203.
01:07What is the company's future plan?
01:09Where will the company use the money raised through IPOs?
01:12There are many such questions.
01:13Let's get to know their answers
01:15directly from the management of DEE Piping Systems.
01:18Today, we have with us the chairman and MD of the company,
01:23KL Bansal.
01:25And the CFO of the company, Sameer Agrawal.
01:28Thank you for your time, gentlemen.
01:30First of all, I will start with Mr. Bansal.
01:34Sir, how do you feel?
01:36The IPO is ready for launch.
01:38Tell us, how do you feel?
01:41It is a very exciting thing for us.
01:44It is the first thing.
01:46Since we are the first generation entrepreneurs,
01:49we are seeing this day today.
01:51It is a great feeling and a sense of achievement.
01:55Tell our viewers about your company.
01:58What does the company do?
01:59What is the business model?
02:00What are the products?
02:01Tell us about this.
02:02Sir, we basically provide piping solutions
02:07to the oil and gas sector and to the power sector.
02:11And when we talk about the oil and gas sector,
02:13there are chemicals, pharma, hydrogen, and LNG included.
02:20We cater to all these sectors.
02:23And when we talk about piping solutions,
02:26first of all, I would like to say that we do not make pipes.
02:29Our job is not to make pipes.
02:31Pipes are our raw material.
02:33We manufacture them according to the requirements of engineering.
02:41And here is its place of use.
02:44We dispatch it there.
02:46Our scope is of engineering, procurement, manufacturing, and supply.
02:52We have a history of 35-36 years.
02:56In that 35-36 years, we have always worked on profit.
03:00And historically, our export has been above 50% on an average.
03:05And in all the major countries of the world,
03:11whether they are developed countries or emerging markets,
03:14our products go to all of them.
03:16And this 50% export,
03:18it is not that it happened once or twice.
03:21Historically, our export has a 10-15 year legacy.
03:25Your company and your business is about 4 decades old.
03:29What names are included in the client list?
03:31I read your RRSP and all the details we read.
03:35I saw that there is a name for Reliance.
03:37Can you tell us more names of our viewers who are included in the client list?
03:41Mr. Sameer, this is a question for you.
03:43You are absolutely right.
03:45All the EPCs and OEMs in the oil and gas sector,
03:48or in the power sector, or in the process industry sector,
03:56maximum those EPCs and OEMs are our customers.
04:01Just to name a few,
04:03Japan Gas Corporation,
04:06Thermex,
04:08Main Diesel,
04:10John Corporal,
04:12Nixon,
04:14HMEL,
04:16Reliance.
04:18So all these are our customers.
04:20If you pay attention to one more thing,
04:22all these customers are big companies,
04:27in the top 500 or top 1000 companies in the world.
04:31What kind of relations do you have with them?
04:34For example, if I talk about Reliance,
04:36which is the oldest in the client list,
04:38which is associated with you,
04:40what kind of relations do you have with them?
04:42How is your business with them?
04:44What is the size of the business?
04:46If you can tell us in detail.
04:48Sir, for this, I would like to tell you that
04:50Thermex is our oldest customer.
04:53And with that,
04:55the age of our company is the same as our relationship with them.
04:59And year after year,
05:01practically,
05:03I will say more than 80-90% of their jobs,
05:06we are doing it single-handedly.
05:09And in the same way,
05:11all our customers,
05:13no one's relationship is less than 10-15 years.
05:16Whoever we acquired before that,
05:18which we do not acquire 1-2 customers every year.
05:22But this is the tagline of our company,
05:25that every customer is a repeat customer.
05:28And we stay 100% on that line and tagline.
05:34And we achieve it.
05:36In the piping division,
05:38I see that most of your revenue comes from operations.
05:42What is your outlook on that, sir?
05:44What are your concerns?
05:45What is your outlook?
05:46What would you like to say, Sameer sir?
05:47If I talk about the Government of India in particular,
05:50on the capex cycle,
05:52or on infrastructure development,
05:54how much focus they have,
05:57they have never been so focused.
05:59And in the same way,
06:01as the government has announced
06:03that new power plants of 80 gigawatts are coming,
06:05so this is like a windfall for us,
06:09that so much work is being created for us,
06:11because we are a very limited player in that.
06:14Whoever works in that sector,
06:16and out of the three players we have selected,
06:18one of them is our name.
06:20So this is a very big opportunity for us in the coming years.
06:24And in the same way,
06:25if we talk about the export market,
06:27there is no problem with the capex cycle anywhere.
06:32Because the energy needs are increasing day by day in the world.
06:37So whether it is the LNG sector,
06:39whether it is the hydrogen sector,
06:41whether it is the gas-based power plants,
06:43as Sameer said,
06:44we work on John Cochrane,
06:46we work on Newton-Richardson.
06:48All these people make HRSG-based power plants,
06:51and all these are our customers.
06:53And we do something or the other for them every year.
06:57And I don't consider it a challenge in any way
07:01to book an order in the next 5-6 years.
07:05And it has always been our history
07:07that we never had a shortage of orders.
07:11If we had a shortage,
07:13it was only a shortage of capacity.
07:15So we slowly built that capacity,
07:18because we are first generation entrepreneurs.
07:20We were 100% dependent on bank finances,
07:23and we spent according to the amount of finance we were getting.
07:27Sameer sir, I have a question.
07:29You have 7 manufacturing plants in India,
07:32and in Bangkok and other countries.
07:35I wanted to know,
07:37what is the current capacity of these plants?
07:41So sir, if I talk about process piping solutions,
07:46at present,
07:48in India,
07:50our capacity,
07:52as on date,
07:54is 53,000 metric tons.
07:57And in Thailand,
07:59that capacity is 14,500 metric tons.
08:04So this is our process piping solutions.
08:09We also manufacture windmill turbine towers.
08:18Our heavy fabrication unit,
08:20which is situated in Gujarat,
08:22has a capacity of 36,000 metric tons.
08:26Sir, where is the demand coming from?
08:28Mostly from Italy, America,
08:30or from which country?
08:33What kind of clients are you getting?
08:35Please tell us about this.
08:37Sir, our client base is mostly in North America,
08:40Europe, and Japan.
08:42And further, our client base is all over the world.
08:45Let us say, we are working for OEMs,
08:49we are working for Japan Gas Corporation,
08:53or we are working for Nutter Ericsson,
08:55or we are working for John Cockrell.
08:57They will be having the projects spread across the world.
09:00Some will come from the Middle East,
09:01some from Africa,
09:02some from USA,
09:03some from North America, Canada.
09:05So we work for them,
09:07for the whole world.
09:08But the major order of inflows,
09:10come from our mostly developed countries,
09:13like North America, Europe, and Japan.
09:16Now, let us talk about IPO.
09:19The IPO fund that you are raising,
09:21where is it going to be used?
09:23Is anything new going to happen in the company?
09:25Please tell me about this, sir.
09:27The total IPO size is 418 crores.
09:32It has two components.
09:34One is the primary component, which is 325 crores.
09:38The second component is the OFS, which is 93 crores.
09:42The 325 crores that we are bringing in the company,
09:46the prime objective of that is
09:50to reduce our debt by 175 crores.
09:55We are raising 75 crores as additional working capital.
10:01And the remaining 75 crores,
10:04that is for general corporate purposes.
10:07So how much debt is there in the company,
10:09and how aggressive is the company towards getting debt-free?
10:12And how long will this debt last?
10:14Sir, let me tell you the first thing.
10:17Our total debt on group level is 400 crores.
10:21And I am saying around, not precisely.
10:25And out of that, we will repay 175 crores.
10:31And as far as our company is concerned,
10:34going forward, how will the debt be,
10:37because we work in projects,
10:40we need bank guarantees and LCs.
10:44So we will have bank facilities,
10:48but definitely with the profits coming up,
10:51we will keep on reducing our debt.
10:54Other than, if there is any opportunity,
10:58if there is a good opportunity for investment,
11:01in relation to our business sector,
11:04we will definitely explore that facility.
11:07So after 5 years, where are we looking at the company?
11:12If we look at it in terms of profit, income,
11:15can you give any guidance on this?
11:18I will answer your question in a different way.
11:22Our company caters to capital expenditure.
11:29And in the next 10 years,
11:33our company will have golden moments.
11:37Because not only in India,
11:40but also across the globe,
11:43the capital cycle is running.
11:45And what you just saw,
11:48that there is a war in Russia and Ukraine,
11:52or more wars are taking place,
11:54because of that, every country
11:57wants to make itself energy efficient.
12:01And wants to strengthen its manufacturing process.
12:06So in the next 10 years,
12:09there are so many opportunities,
12:11that I can't describe it in words.
12:14You can't describe it in words,
12:16but it is a good outlook,
12:18because the future of demand is looking good.
12:21Thank you so much, sir.
12:23Best wishes to both of you and the team.
12:27Thank you so much, sir.
12:28Thank you, sir. Thank you.
12:29Thanks a lot.
12:30Very nice talking to you.
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