Vibhor Steel Tubes to debut today: Stock may list at 86-92% premium to IPO price

Vibhor Steel Tubes IPO: Ahead of the listing, the shares were commanding a 92 percent premium in the grey market

Vibhor Steel Tubes stock is expected to make a strong debut on bourses on February 20. Analysts expect the shares to list at an 86-92 percent premium over the IPO price of Rs 151, somewhere between Rs 280 and Rs 291.

Ahead of the listing, the shares were commanding a 92 percent premium in the grey market, an unofficial ecosystem where shares start trading before the allotment in the IPO and continue till the listing day. Most investors track the grey market premium (GMP) to get an idea of the listing price.

“The IPO received a strong 320x oversubscription, and we expect the stock to list at a premium of around 86 percent to the issue price,” said Dhruv Mudaraddi, Research Analyst, StoxBox.

All you need to know about Vibhor Steel Tubes IPO

The price band for the Rs 72.17-crore issue, which opened for subscription on February 13 and closed on February 15, was fixed at Rs 141-151 a share. It was entirely a fresh issue of shares. The anchor book opened for a day on February 12 in which the company raised Rs 22 crore from Saint Capital Fund, Chhattisgarh Investments Ltd and Neomile Growth Fund-Series I.

“The IPO garnered a phenomenal response and the GMP has continuously climbed, currently sitting at a staggering Rs 140 above the issue price of Rs 151. This excitement paints a positive picture for Vibhor Steel Tubes' first day on the exchanges,” said Shivani Nyati, Head of Wealth, Swastika Investment Ltd.

In the six months ended September 30, 2023, the company's revenue stood at Rs 530.51 crore, net profit at Rs 8.52 crore and EBITDA at Rs 23.69 crore. In the same period, the PAT margin was at 1.61 percent, the EBITDA margin at 4.47 percent, the debt-to-equity ratio at 1.83 times, RoCE at 6.97 percent and RoE at 8.37 percent.

Vibhor Steel Tubes is a manufacturer and exporter of mild steel/carbon steel ERW black and galvanised pipes, hollow steel pipes and cold-rolled steel strips/coils. The company has a long-term agreement for six years with Jindal Pipes. The company has two manufacturing facilities in Raigad, Maharashtra, and Mahabubnagar, Telangana and a warehouse in Haryana's Hisar.

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