Strong market debut: Gallard Steel shares settle 56% higher than IPO price on debut day

The shares of Gallard Steel made a strong stock markets debut on November 26, listing at Rs 223.10 apiece on the BSE SME platform. This marks a premium of 48.73 percent over the IPO price of Rs 150 apiece. The company's market capitalization during market debut stood at nearly Rs 212 crore.

The stock then surged another 5 percent to close at Rs 234.25 apiece, marking a rise of more than 56 percent from the IPO price. The company's market capitalisation at the end of the debut day stood at Rs 222.54 crore.

Listing premium vs grey market estimates:

The strong listing premium is higher than the grey market estimates. Ahead of listing, the unlisted shares of the company were trading with 42 percent grey market premium (GMP) over the IPO price at Rs 213 apiece, according to data on Investorgain.

Gallard Steel IPO:

The initial public offering of the Madhya Pradesh-based cast components manufacturer saw strong investor interest during its three days of public bidding. The Rs 37.5-crore maiden issue of the company, which entirely comprised a fresh issue of shares, was subscribed around 350 times during its three days of public bidding between November 19 and November 21.

Non-institutional investors (NII) showed the most interest in the IPO, booking their allotted quota nearly 464 times. The portions set aside for retail investors and qualified institutional buyers (QIB) were subscribed 351.58 times and 228.48 times, respectively.

The price band for the IPO was set at Rs 142-150 per share. Investors could bid for a minimum of 1,000 shares, requiring an investment of Rs 1.5 lakh per lot at the upper price band, and in multiples thereafter.

How will the IPO proceeds be used?

Gallard Steel, which makes traction motor and bogie assembly components for the railway sector, will use the IPO proceeds mainly for expansion of the existing manufacturing facility and construction of office building, and repayment of certain borrowings. The remainder funds will be utilised for general corporate purposes.

Gallard with one manufacturing facility in Pithampur, Madhya Pradesh also manufactures components for industrial machinery and equipments. Apart from this, its subsidiary Sleeploop India acquired in February 2024 operates two separate divisions - CNC machining and rebounded foam manufacturing.

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