Sambhv Steel Tubes IPO Day 3 Live: Issue subscribed 21.72x so far. Check GMP, key dates, other details. Apply or not?

Sambhv Steel Tubes IPO Day 3 Live: Sambhv Steel Tubes' initial public offering, which is set to conclude today, Friday, June 27, has seen respectable subscription levels, primarily driven by Non-Institutional Investors (NIIs) and followed by retail investors.

Sambhv Steel Tubes IPO was available for public subscription on Wednesday, June 25. Sambhv Steel Tubes IPO price band has been set between ₹77 and ₹82 per share, with a face value of ₹10. The company has indicated that 50% of the total offering is allocated for qualified institutional buyers, 35% for retail investors, and the remaining 15% for non-institutional investors.

The basis of share allotment for the Sambhv Steel Tubes IPO is expected to be formalized on Monday, June 30. Refunds are scheduled to begin on Tuesday, July 1, and shares will be credited to the demat accounts of those who are successful in securing allotments on the same day as the refunds. The shares of Sambhv Steel Tubes are likely to debut on the BSE and NSE on Wednesday, July 2.

As of March 31, 2024, Sambhv Steel is recognized as one of the top manufacturers of electric resistance welded (ERW) steel pipes and structural tubes (hollow sections) in India based on installed capacity.

A report from Crisil suggests that the demand for domestic steel pipes and tubes is forecasted to grow at a compound annual growth rate (CAGR) of 5-6%, reaching an estimated 12.50-13.50 million tonnes per annum (MTPA) in FY25, an increase from 8.8 MTPA recorded in FY19.

Sambhv Steel Tubes IPO Day 3 Live: Competitve Strengths 

1. A single location backward integrated facility in India

2. Strong process innovation and execution capabilities allowing them to produce value-added products

3. Wide-spread well connected distribution network across India

4. Well-positioned to take advantage of the growing demand for quality ERW steel pipes and tubes

Sambhv Steel Tubes IPO Day 3 Live: Track record of healthy financial performance

They have established a track record of healthy revenue growth and profitability. Their revenue from operations increased to ₹12,857.57 million in Fiscal 2024 from ₹8,193.49 million in Fiscal 2022 while their restated profit for the year increased to ₹824.39 million in Fiscal 2024 from ₹721.08 million in Fiscal 2022. 

Their revenue from operations in the nine-month period ended December 31, 2024 was ₹10,160.92 million and their profit after tax in the nine-month period ended December 31, 2024 was ₹406.85 million.

Sambhv Steel Tubes IPO Day 3 Live: Canara Bank Securities views 

As stated by Canara Bank Securities, the company’s backward integration provides cost benefits and enhances supply chain management, positioning it favorably for scalable growth.

In terms of valuation, the company is trading at a P/E ratio of 36.39x (annualized 9M FY25) and 21.64x (FY24), compared to a peer average of approximately 27.14x. Its P/B ratio is at 4.13x (9M FY25) and 4.51x (FY24), which is slightly above the peer average of around 4.64x. Although the valuations seem to be slightly higher, they are supported by the company's distinct integration strategy, improving product offerings, and a strong growth forecast. The brokerage suggests a SUBSCRIBE rating for long-term investors due to Sambhv’s robust fundamentals, cost benefits, and positive sector trends.

Sambhv Steel Tubes IPO Day 3 Live: Subscription Status

Sambhv Steel Tubes IPO subscription status is 1.76 on day 2, so far. The retail portion was subscribed 1.84 times, and NII portion has been booked 3.12 times, Qualified Institutional Buyers (QIBs) portion has received 61% bids. Employee Reserved portion has been booked 1.52 times.

The company has received bids for 8,65,22,618 shares against 4,92,06,100 shares on offer, at 17:00 IST, according to data on BSE.

Sambhv Steel Tubes IPO Day 3 Live: Sambhv Steel Tubes IPO Review

As per BP Equities, the firm is presently assessed with a P/E ratio of 273x at the upper price band, based on annualized earnings for FY25, which is relatively elevated; nonetheless, it is well-positioned for future expansion, given that it is the sole participant in this emerging sector with plans to repay debt and invest in its subsidiary. Therefore, the brokerage suggests a 'SUBSCRIBE' rating for investors looking at a medium to long-term investment strategy.

Sambhv Steel Tubes IPO Day 3 Live: IPO Details

The initial public offering comprises a new issue of equity shares estimated at ₹440 crore along with an offer for sale (OFS) of shares amounting to ₹100 crore from the promoters.

Proceeds from the fresh issue will be utilised for payment of debt and general corporate purposes.

Nuvama Wealth Management and Motilal Oswal Investment Advisors are the book-running lead managers to the issue.

Sambhv Steel Tubes IPO Day 3 Live: Sambhv Steel IPO GMP today

Sambhv Steel Tubes IPO GMP today is +11. This indicates Sambhv Steel Tubes share price was trading at a premium of ₹11 in the grey market, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Sambhv Steel Tubes share price is indicated at ₹93 apiece, which is 13.41% higher than the IPO price of ₹82.

According to the activities in the grey market over the past 15 sessions, today's IPO GMP is trending upwards and is anticipated to have a robust listing. The minimum GMP observed is ₹0.00, while the maximum GMP stands at ₹11.00, as per the insights from investorgain.com experts.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.