Belrise Industries IPO to list on Wednesday; here’s what GMP signals ahead of debut

Belrise Industries IPO: The IPO of Belrise Industries, which concluded recently, is set to debut on the Indian stock exchanges on Wednesday, May 28. The issue received a healthy response from all categories of investors during its bidding period between May 21 and May 23, resulting in an overall subscription of 43 times.

Given the strong demand, investor focus has now shifted to potential listing gains, typically gauged by the grey market premium (GMP). According to market sources, the company's shares are commanding a healthy GMP of ₹24 ahead of listing.

Based on the IPO's upper price band of ₹90 and the current GMP, the estimated listing price of Belrise Industries stands at ₹114 per share, a 26.6% above the issue price. The grey market premium indicates investors’ willingness to pay a premium over the IPO price.

The mainboard IPO, valued at ₹2,150 crore, is entirely a fresh issue of 23.89 crore shares. According to exchange data, the portion reserved for non-institutional investors was subscribed 40 times, retail investors 4.52 times, and qualified institutional buyers 112 times.

Belrise Industries plans to utilize the net proceeds from the issue towards repayment or pre-payment, in full or in part, of certain outstanding borrowings, as well as for general corporate purposes.

About Belrise Industries

Belrise Industries is an Indian automotive component manufacturer offering a wide range of safety-critical systems and engineering solutions for two-wheelers, three-wheelers, four-wheelers, commercial vehicles, and agricultural vehicles.

As of March 31, 2024, the company holds a 24% market share in the overall two-wheeler metal components segment in India (by revenue), making it one of the top three players in the segment. With rising product sales and a growing international presence, Belrise has shown strong revenue growth.

Its product portfolio includes metal chassis systems, polymer components, suspension systems, body-in-white components, and exhaust systems. Major clients include Bajaj, Honda, Hero, Jaguar Land Rover, Royal Enfield, VE Commercial Vehicles, Tata Motors, and Mahindra.

Analysts at Geojit Investments Ltd noted that at the upper price band of ₹90, the IPO is valued at a P/E ratio of 25.8x (FY24 EPS), which appears reasonably priced considering its long-term profitability and PAT margin expansion driven by improved financial metrics.

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