Classic Electrodes IPO GMP & Subscription status

Core Business & Overview

• Founded in 1997 and headquartered in Kolkata, West Bengal, Classic Electrodes (India) Limited specializes in manufacturing welding consumables, including a broad product range such as electrodes and MIG (Metal Inert Gas) wires.
• The company operates two manufacturing units: one in Dhulagarh, West Bengal, and another in Jhajjar, Haryana.
• Its product suite is extensive and includes:
  • Mild steel electrodes
  • Stainless steel electrodes
  • Cast iron electrodes
  • Deep-penetration electrodes
  • Low-alloy, low-hydrogen, and other specialized electrodes
  • MIG wires.

Strengths

1. Quality & Certifications
   Classic Electrodes holds several internationally recognized certifications:
   • ISO 9001, ISO 14001, ISO 45001
   • CE (Conformité Européenne)
   • Bureau of Indian Standards (BIS)
     Additionally, it is approved by major Indian and global institutions such as BHEL, NTPC, ONGC, RDSO/ICF, Lloyd’s Register, IBR, among others.
2. Advanced Manufacturing & R&D
   The company emphasizes cutting-edge technology, with continuous R&D efforts, state-of-the-art infrastructure, and quality control supervised by experienced engineers.

Risks

1. Raw Material Cost Volatility
   The company may face cost fluctuations due to reliance on imported raw materials—a vulnerability in a competitive commodity-driven industry.
2. Intense Competition
   It competes against large, well-established domestic and international players in welding consumables, which could pressure margins and market share.
3. Financial Leverage & Scale Constraints
   A moderate debt-to-equity ratio (1.23) suggests some leverage. As an SME, the company may also face scale limitations compared to larger industry peers

Financial Performance Overview (₹ in Crore)

Revenue

• FY 2022: ₹133.84 Cr
• FY 2023: ₹150.87 Cr (+12.7% YoY)
• FY 2024: ₹193.82 Cr (+28.4% YoY)
  
  Revenue has grown steadily, showing strong business expansion, especially in FY 2024.

Profit

• FY 2022: ₹1.45 Cr
• FY 2023: ₹2.08 Cr (+43.4% YoY)
• FY 2024: ₹12.28 Cr (+490% YoY)
  
  Profit jumped sharply in FY 2024, indicating improved operational efficiency and margin expansion.

Total Assets

• FY 2022: ₹74.99 Cr
• FY 2023: ₹76.79 Cr (+2.4% YoY)
• FY 2024: ₹92.20 Cr (+20.1% YoY)

Asset base is expanding, reflecting capacity growth and capital investment to support operations.

✅ Pros

• Strong revenue growth with ~20% CAGR over 3 years.
• Profit surged sharply in FY24, showing better margins.
• Approved by reputed institutions (BHEL, NTPC, ONGC, etc.).
• Wide product range in welding consumables and MIG wires.
• Expanding asset base indicates capacity growth.
• Certified with ISO, CE, BIS for quality assurance.
• IPO funds to be used for capex, debt repayment, and working capital.

❌ Cons

• High dependence on raw material prices may affect margins.
• Faces tough competition from larger global and domestic players.
• Moderate debt-to-equity (1.23) adds financial risk.
• SME IPOs generally have lower liquidity in the secondary market.
• Business growth sensitive to industrial and infrastructure cycles.