The Rs 600 crore qualified institutional placement (QIP) offer of Hi-tech Pipes -- the third-largest pipe maker of the country with a capacity of nearly a million tonnes – has got bids worth more than Rs 800 crore with a number of global and domestic institutional investors participating in the offer, said persons aware of the development.
The Delhi-based company, which has marquee clients including BHEL, SAIL, NTPC, Adani Group, Jio, Shapoorji Pallonji, ArcelorMittal Nippon Steel India and Delhi Metro among others, plans to use the funds for doubling its capacity to nearly 2 million metric tonnes per annum (MTPA).
“Around 15-20 investors participated in the offer with marquee names from the Indian mutual fund industry also participating. Large treasuries have also shown interest and the shares have been placed at a price of around Rs 185,” said a person familiar with the offer details.
Shares of the company settled at Rs 201.50 per share on the NSE, down marginally by 0.40 percent. The stock has fallen after three days of consecutive gain.
The company already boasts of good names in its list of shareholders with mutual funds owning a stake of 7.13 percent – ITI Mutual Fund, Bandhan Mutual Fund and HSBC Mutual Fund own over a percent each through their schemes.
Further, alternative investment funds or AIFs also have a stake of a little over three percent in the company with foreign institutional investors (FIIs) owning a stake of nearly nine percent.
Moneycontrol had reported last week that the company was planning to raise as much as Rs 600 crore through a QIP offer, which could open this week.
On October 7, the fund-raising committee of the company finalised and adopted the preliminary placement document. “The company may at its discretion offer a discount of not more than 5% on the floor price for the issue,” the company said in an exchange filing.
The issue price will be determined by the company in consultation with the book running lead manager appointed in relation to the issue, it added.
Meanwhile, the company has already expanded its capacity from 3.6 lakh MTPA in FY18 to 7.5 lakh MTPA in FY24 and is in the process of further expanding its capacity from 1 million MTPA in FY25 to 2 million MTPA by FY27, which will make it the second-largest player in the industry after Apollo Pipes.
The company has a network of more than 450 dealers and distributors with six plants spread across states including Uttar Pradesh, Gujarat, Maharashtra, Andhra Pradesh and NCR region. Using the QIP proceeds, the company aims to set up one more plant by end of the current year.
The company, which aims to be a debt-free company by FY26, achieved its highest-ever sales volume in Q2FY25 and H1FY25.
“The company reported sales volumes of 123,027 MT for Q2 FY25, representing a remarkable 22.50% year-on-year (YoY) growth. For the first half of FY25, sales volumes reached to 245,182 MT, reflecting an outstanding 32.55% YoY increase,” stated a stock exchange announcement by the company last week.
The company, with a market capitalisation of a little over Rs 3,500 crore, is part of the BSE SmallCap index. Shares of the company have surged nearly 50 percent in the last three months with the one-year gains pegged at over 138 percent.
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