The listing performance was above expectations, as the grey market premium suggested a 17% listing pop.
ALSO READ | HDB Financial gets first ‘buy’ rating on listing day with 22% upsideAhead of its debut, Sambhv Steel’s grey market premium (GMP) stood at ₹14 per share in the unofficial market, suggesting a listing pop of 17.07% for investors.
The IPO was priced between ₹77-82 per share and was open for bidding from June 25 to June 27. Sambhv Steel Tubes raised ₹540 crore through the IPO.
The IPO included a mix of fresh issue of equity shares valued at ₹440 crore and an offer for sale (OFS) of shares worth ₹100 crore by promoters.The Raipur-based company had already mobilised ₹161.25 crore from anchor investors like WhiteOak Capital Mutual Fund (MF), Motilal Oswal MF, Nuvama Asset Management, Astorne Capital VCC Arven, Citigroup Global Markets Mauritius, Nomura Singapore, Societe Generale, and BNP Paribas Financial Markets, among others.
Proceeds from the fresh issue will be utilised for payment of debt and general corporate purposes.
Sambhv Steel is one of the key manufacturers of electric resistance welded (ERW) steel pipes and structural tubes (hollow section) in India in terms of installed capacity as of March 31, 2024.
According to a Crisil report, the demand for domestic steel pipes and tubes is expected to have grown at a compound annual growth rate (CAGR) of 5-6% to 12.50-13.50 million tonne per annum (MTPA) in FY25 from 8.8 MTPA in FY19.
The growth was led by government initiatives to augment urban structural infrastructure and to infuse investments in the oil and gas sector.
In FY24, Sambhv posted a revenue of ₹1,285.76 crore, up 37% on-year. Profit came in at ₹82.44 crore, with EBITDA margins at 12.40%.
The company’s net worth doubled from ₹210.4 crore in FY23 to ₹438.28 crore in FY24, while borrowings also surged to ₹619.14 crore, a factor the issue aims to correct.
