Shares of Vibhor Steel Ltd. surged up to 195% over the issue price on the first day of trading, making it the best listing of the year. That also propelled it into the league of the best market debuts ever for Indian stocks.
Vibhor Steel surpassed Religare Enterprises Ltd.'s premium on its debut to rank at the top so far this year. The stock listed at Rs 425 apiece on the National Stock Exchange and Rs 421 per share on the BSE, a premium of 178% over its IPO price. It jumped as much as 193.70% to Rs 443.50 apiece in early trade.
The shares ended at a premium of 192.72% over the IPO price and gained 4.99% from its listing price to end at Rs 442 apiece.
This is the fourth best listing on Indian bourses ever, after Sigachi Industries (listed in November 2021), Paras Defense and Space Technologies (October 2021) and Religare Enterprises (November 2007).
The Rs 72.17 crore was subscribed 298.86 times by its third and final day. The bids were led by non-institutional investors (721.34 times), retail investors (188.17 times), and institutional investors (178.73 times) and portion reserved for employees (201.48 times).
Talking about expansion plans Vibhor Kaushik, managing director at Vibhor Steel Tubes stated that lands have already been acquired in Odisha, and significant construction is underway. The Odisha plant will be funded through internal accruals. "We already purchased lands in Odisha, and a lot of construction has already started." The projected capital expenditure (capex) for the Odisha plant is estimated to be around 60 crore, and it will be executed in phases.
Kaushik mentioned that the initial production is expected to commence by the end of the first quarter or the beginning of the second quarter.
Anchor Investor
The company has raised Rs 22 crore from anchor investors. It has allocated 14.24 lakh equity shares to three anchor investors at Rs 151 apiece, which is also the upper end of the price band. Saint Capital Fund, Chhattisgarh Investments Ltd. and Neomile Growth Fund - Series I are among participants part of the pre-IPO round fundraising.
Khambatta Securities Ltd. is the sole book running lead manager, and Kfin Technologies Ltd. is the registrar to the IPO.
Business
VSTL manufactures steel products like electric resistance welded pipes, hot-dipped galvanised pipes and hollow section pipes.
The company has its plants in Maharashtra, Telangana and Haryana. It will also expand its operations by setting up a manufacturing unit in Odisha, according to the statement.
The company supplies its products to western and southern market companies in Maharashtra, Gujarat, Madhya Pradesh, Telangana, Karnataka and Tamil Nadu.
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