Standard Glass Lining IPO—Should You Also Subscribe To The Overbooked Issue? What Brokerages Say
Adroit Financial, Canara Bank Securities, and DRChoksey Finserv offer their take on the engineering equipment maker's IPO.
Standard Glass Lining Technology Ltd., a player in specialised engineering equipment for the pharmaceutical and chemical industries, has already been booked over eight times on its first day of subscription.
With a total offer size of Rs 410.05 crore and a price band of Rs 133–Rs 140 per share, the company aims to raise Rs 210 crore via fresh equity and Rs 200.05 crore through an offer-for-sale.
The grey market premium of Standard Glass Lining IPO stood at Rs 96 as of 1 p.m. on Monday, according to InvestorGain platform. This took the estimated listing price to Rs 236 per share, implying a potential gain of 68.6%. However, the GMP is not an official price quote for the stock and is based on speculation.
Here's a look at what leading brokerages have to say on whether you should subscribe to this IPO.
Why The Buzz
Standard Glass Lining has carved a niche in a Rs 1,500-crore market, growing at a compound annual growth rate of 50.45% over the past two years, as per the company's financials. Its client-centric turnkey solutions, automation-focused manufacturing, and maintenance services have driven 100% repeat business. The company's proprietary technology, in partnership with Japan's AGI, and ambitious plans for export-led growth further enhance its appeal.
What The Brokerages Say
Adroit Financial
Adroit Financial Services Pvt. recommends a 'subscribe' rating, pointing towards the company's strong financial performance and strategic market positioning. It highlighted the following points:
Growth metrics: Revenue CAGR of 50.45% over two years, with an average earnings per share of Rs 3.29 and a return on net worth of 35.37%.
Valuation: The IPO is priced at a price-to-earnings ratio of 37.78 times at the lower band and 39.77 times at the upper band—competitive compared to industry averages.
Market opportunity: The Indian glass-lined equipment market is projected to grow significantly, driven by rising demand from the pharmaceutical and chemical sectors.
Canara Bank Securities
Canara Bank Securities Ltd. is bullish on the stock, emphasising its innovation-driven growth and diversified revenue streams. It highlighted the following points:
Technological edge: Proprietary Japanese technology supports high-margin products and operational efficiency.
Export potential: Plans to boost export revenues to 20% in fiscal 2026, leveraging superior product lifespan and high-margin international sales.
Valuation comparison: Priced attractively with a P/E of 39.77 times versus the sector average of 52.5 times.
The brokerage is optimistic about the company's capacity expansion and long-term market penetration, making it a strong candidate for both listing and long-term gains.
DRChoksey
DRChoksey FinServ Pvt. also gives the company a 'subscribe' rating, citing the following points:
Expansion plans: IPO proceeds will fund capacity expansion, increasing unit production across Standard Glass Lining and its material subsidiary S2 Engineering Industry Pvt.
Valuation metrics: At a P/E of 47 times and an EV/Ebitda of 30 times, the company is considered fairly valued against its peers.
Future outlook: The company aims to grow export revenues from 0.4% in fiscal 2024 to 12–15% in fiscal 2025, with a targeted 25% year-on-year revenue increase.
Key Positives Driving Subscription Recommendations
Market leadership: Standard Glass Lining serves 800 clients across pharmaceuticals, agrochemicals, and other industries, capturing a significant share of India's 6,000-potential-client market.
Sectoral growth: The pharmaceutical and chemical industries are expanding rapidly, fueling demand for Standard Glass Lining's products.
Export growth potential: Strategic partnerships and capacity expansion position the company to capture high-margin export markets.
Use Of Proceeds
Funding of capital expenditure requirements of the company towards the purchase of machinery and equipment.
Repayment or prepayment, in full or in part, of all or a portion of certain outstanding borrowings availed by the company.
Investment in wholly-owned arm S2 Engineering for funding its capital expenditure requirements towards the purchase of machinery and equipment.
Funding inorganic growth through strategic investments and/or acquisitions.
General corporate purposes.
Verdict: Should You Subscribe?
Three brokerages—Adroit Financial, Canara Bank Securities, and DRChoksey—recommend to subscribe to the Standard Glass Lining IPO. The company's strong financials, growth trajectory, and market leadership make it an attractive option for both listing gains and long-term investments. However, investors should keep an eye on potential macroeconomic challenges, they added.
