JSW Cement IPO closes with 8x subscription on Day 3, led by QIB demand; GMP declines

JSW Cement IPO Day 3

The Rs 3,600-crore IPO of JSW Cement saw strong investor interest on its third and final day of bidding, being subscribed nearly 8 times its offer size on August 11. This comes despite the initial public offering seeing a dip in grey market estimates.

The maiden public issue of the company received bids for nearly 141 crore shares, according to data on NSE. Non Institutional Investors (NII) booked their reserved portion nearly 11 times. Retail individual investors subscribed their reserved portion nearly 2 times. The portion kept for Qualified Institutional Buyers (QIB) has been booked nearly 16 times.

JSW Cement IPO GMP:

Ahead of listing, the unlisted shares of the company were trading with a grey market premium of 3.4 percent over the IPO price at Rs 152 apiece, according to data on Investorgain. This is lower than the 6 percent GMP cited by the site on Day 2 (August 8) of public bidding.

According to IPO Watch, the unlisted shares were trading with more than 4 percent GMP over the IPO price at Rs 153 apiece.

Key things to know about JSW Cement IPO:

JSW Cement had launched its IPO to raise Rs 3,600 crore through a fresh issue of shares worth Rs 1,600 crore, and an offer for sale worth Rs 2,000 crore by the existing shareholders. The IPO was open for public bidding from August 7 to August 11 at a price band of Rs 139-147 apiece. This values the 17-year-old company at Rs 20,000 crore at the upper end of the price band.

Investors could bid for a minimum of 102 shares, requiring an investment of nearly Rs 15,000 at the upper price band, and in multiples thereafter. The allotments will likely be finalized on August 12, and the shares are scheduled to be listed on BSE and NSE on August 14.

The company aimed to use up to Rs 800 crore from the proceeds of the fresh issue to part finance the cost of establishing a new integrated cement unit at Nagaur, Rajasthan. Further, up to Rs 520 crore is set to be used for prepayment or repayment, in full or in part, of all or a portion of certain outstanding borrowings availed by the Company, along with general corporate purposes.

Should you apply for JSW Cement IPO:

JSW Cement’s IPO is suitable for investors with a long-term horizon and a high-risk appetite, said Gaurav Garg from Lemonn Markets Desk. “While short-term listing gains are uncertain due to rich valuations and near-term earnings pressure, the company holds long-term promise as India transitions toward more sustainable and resource-efficient infrastructure development,” he added.

"We advise subscribing only with a long-term view, citing rich valuations and near-term earnings pressure, but highlighting the company’s strong growth potential in India’s infrastructure expansion," he later said.

Angel One remained neutral on the IPO. “With an EV/EBITDA valuation of 30.02×, significantly higher than sector peers and a net loss reported in FY25, the issue appears fully priced. While JSW Cement’s long-term growth prospects remain intact, the current financial profile and valuation warrants a cautious stance, justifying a ‘Neutral’ recommendation,” the brokerage said.

Choice Broking advised investors to subscribe to the IPO for the long term, while cautioning them that the public issue’s valuation appears aggressive. “Presently, JSW Cement is in an active expansion phase, with subsidiaries like Shiva Cement and Utkarsh Transport currently in the ramp-up or early stages. While these entities are loss-making at present, they are strategically aligned with the company’s long-term growth. From a valuation perspective, these investments may depress near-term profitability but are expected to contribute meaningfully to earnings and return ratios as utilization improves and scale benefits are realized," it said.

A day before the IPO opened for public bidding, JSW Cement raised Rs Rs 1,080 crore via anchor book on August 6. Total 52 institutional investors participated in the anchor book of the Sajjan Jindal-owned JSW Group company, including nine domestic mutual funds.

Follow all IPO news here.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.