Narmadesh Brass Industries IPO Analysis: Should You Apply or Skip?

As India’s demand for non-ferrous metals accelerates, Narmadesh Brass Industries emerges as an integrated brass manufacturer across domestic and global markets.

Let’s explore this upcoming IPO further:

Narmadesh Brass Industries’ share price will be finalised post-allotment, while grey market cues through the Narmadesh Brass Industries’ IPO GMP will likely reflect market sentiment closer to listing.

The Industry Backdrop: India’s Brass Industry 

The Indian brass components industry is a specialised yet steadily expanding segment within the broader metals, plumbing, and electrical hardware ecosystem. Brass components—valued for their corrosion resistance, machinability, and durability—are extensively used in plumbing fittings, electrical accessories, industrial machinery, automotive parts, and agricultural equipment. 

Demand is supported by rising infrastructure development, growth in real estate and urban utilities, expansion of precision engineering applications, and increasing export opportunities, particularly from manufacturing clusters like Jamnagar. 

The Indian Brass market, valued at $0.57B in 2025, is expected to grow at a CAGR of 4.3%, reaching $0.73B by Fy31. Growth drivers involve a rise in construction and a push for brass use due to sustainability over other metal components.

The industry’s momentum is further reinforced by the shift toward organised manufacturing, export-led demand for high-precision parts, and the need for reliable metal components across diversified end-use sectors.

Originating in 2019, & headquartered in Jamnagar, Gujarat—India’s largest brass manufacturing hub, Narmadesh Brass Industries is involved in the production of brass rods, billets, plumbing and electrical fittings, and precision-machined components. The operations involve casting and machining, allowing it to manufacture a diverse product portfolio used across various industries & markets.

With a focus on supplying consistent-quality brass components, the company caters to both domestic and export customers and aims to scale by expanding capacity, widening product offerings, and strengthening its presence in value-added precision brass components. 

Positioned within a fragmented but steadily growing brass industry, Narmadesh leverages Jamnagar’s established supplier ecosystem and rising demand across construction, electrical, and engineering sectors.

(Segment-wise Revenue %)

The revenue mix indicates a shift toward core brass products, with Brass Rods and Billets becoming the dominant contributors in FY25, together accounting for a majority of sales. 

While Brass Valve Parts had a strong share in FY24, its contribution declined in FY25, and Agricultural Parts remained a smaller portion throughout. Overall, the trend suggests increasing focus on volume-driven semi-finished products over value-added components.

Capacity: How Much Can Narmadesh Really Make?

Currently, Narmadesh has an installed capacity of Brass Billets of 4,320 MTPA, Brass Rods of 4,320 MTPA and Brass Components of 1,440 MTPA. 

The utilisation trends are influenced by several factors, including market demand, availability of raw materials & labour, industry conditions, and procurement practices followed by customers.

NBIL maintains brass rods capacity at 4,320 MTPA with improved utilisation from 63% (FY23) to 78% (FY25), signalling stronger demand absorption. 

Brass components utilisation rose steadily from 50% to 62% at 1,600 MTPA capacity, while billets remain underutilised at 9-11% of 4,320 MTPA, indicating focus on higher-margin rods/components over billets.

Overall, it can be said that the company has further room for increasing its capacity utilisation. The company is using a portion of IPO proceeds towards capex, which involves the purchase of an advanced CNC machine and packaging equipment, which will help boost efficiency.

The top line has given a moderate growth at 21% CAGR from FY23 to FY25. While the growth in FY25 has been at just 11%. The brass industry growth rate is at a low single digit, backed by a large number of private and unorganised players. 

Margins have improved sharply, with EBITDA margins expanding from 3.6% in FY23 to 10.6% in FY25. The PAT margins have also risen, being at 1.5% in FY23 to 6.5% in FY25. That’s a big shift toward higher-value formulations and better cost control.

On further analysis, it was found that the dip in margins in Fy25 was primarily due to expansion in international market for exports. The management mentioned about selling products at lower prices to capture the foreign markets.

After consecutive years of negative CFO, the company has reported positive cash flow from operations, at 1.3Cr in FY25. 

It is however observed that the financials has  a surge in working capital days, which has increased significantly from 56 days in FY23 to 110 days in FY25. The growth in debtors and inventory has been higher than the actual sales growth over the years.

D/E ratio, despite giving a rising trend in the past 2 years, being at 1.7 in FY25, has shown improvement from the previous year's figure of 2.5 in FY24. The company also aims to partly settle the borrowings from the IPO proceeds, indicating a better leverage position in the future.

ROE and ROCE stand at 49.7% and 23.1%, respectively. The financials witnessed a surge in ROE & ROCE, when compared to FY23, placing Narmadesh above the listed peers. The company has also maintained its current ratio well over the years, currently at 1.19.

Management + Promoter Holding

NBIL's promoters—Mr. Hitesh Dudhagara, Mrs Ronak Dudhagara, and Sprayking Limited—collectively bring over 50 years of industry expertise.

The promoters serve as the experienced leadership of a long-haul enterprise. Mr Hitesh Dudhagara contributes 20 years of strategic guidance, Mrs Ronak Dudhagara offers 10 years of operational proficiency, and Sprayking Limited (a listed promoter manufacturing agricultural sprayers and brass components) provides a 20-year established foundation.

While 2 out of 5 board members are independent directors, the governance ensures quality as the audit and remuneration committees are led by independent directors. 

However, it must be noted that NBIL's transactions with promoter entity Sprayking Limited accounted for 30% of purchases, raising dependency and potential conflict-of-interest risks.

From a control standpoint, the promoters hold a dominant 99.92% stake pre- issue. Post-IPO, this stake will dilute to 71.84%, but promoter influence will remain firmly intact, given their high base ownership and board control.

On the basis of peer analysis, it can be said that Narmadesh Brass Industries has an average quality of financials. The EBITDA & PAT margins are 10.6% and 6.1%, respectively, which are higher than its peers.The return ratios of the company are in the industrial range, with ROE & ROCE at 49.7% & 23.1%, respectively.

In terms of valuation, it must be noted that Narmadesh Brass Industries has a higher P/E ratio at 19.9x, while the EV/EBITDA stands at 17.7x. The borrowings are also at a higher end, with a D/E ratio of 1.7.

Overall, in terms of margins and valuation, when compared to peers, it can be said that the company has a moderate level of financials, requiring focused efforts by the management. 

IPO Objectives

The company will be using the proceeds for:

• Capital expenditure (₹329 lakhs): Acquiring advanced CNC rotary machines, servo turrets, PLC controls, and packing equipment from an overseas supplier to enhance brass component production efficiency.

• Debt reduction (₹1,450 lakhs): Full/part prepayment of secured loans from HDFC Bank, including cash credit and term loans, to optimise leverage.

• Working capital needs (₹1,020 lakhs): Bolstering liquidity for raw materials, receivables, and operations in brass manufacturing.

• General purposes (balance): Up to 15% for strategic flexibility, corporate expenses.

Overall, the issue aims to strengthen Narmadesh’s manufacturing capacity & day-to-day business activities while improving its financial flexibility. The combination of expansion and deleveraging positions the company for more sustainable future growth.

At Alpha Venture X Fund, we assess opportunities through our LMVT framework — Leadership, Moat, Valuation, and Tailwinds — enabling us to identify scalable businesses with durable fundamentals.

Leadership: Founder-led with strong industrial experience and equity retention, ensuring aligned execution and focus on scaling the brass components business.

Moat: Despite having in-house manufacturing, the company lacks a moat since Narmadesh is a commoditised business. Putting it at risk in terms of expansion. 

Tailwinds: Growth in automotive and hardware manufacturing. Sustainability push will act as a tailwind since 60% of brass in circulation consists of recycled components.

Valuation: The company is over-valued with P/E being at 19.9x; the EV/EBITDA ratio is also on the higher side, currently at 17.7x. 

Bottom Line: Narmadesh has a low level of revenue growth. The company lacks a moat; brass is a commoditised industry backed by intense competition from large private & unorganised players. The valuation is also not attractive, being at a higher range. Narmadesh Brass Industries is not a buy for investment purposes.