Stellar debut: Vibhor Steel Tubes share price almost doubles on listing

• The stock closed at ₹442 as compared to its issue price of ₹151 per share.
• The market capitalization of the company is at ₹838 crore, as per Bombay Stock Exchange.
• The grey market was expecting 86% listing gains, and the issue was subscribed 320x.

Shares of Vibhor Steel Tubes debuted on Dalal Street with 192% listing gains on Tuesday. The stock closed at ₹442 as compared to its issue price of ₹151 per share. The market capitalization of the company is at ₹838 crore, as per BSE.

The grey market was expecting 86% listing gains from the stock. Analysts also believed that its price band has left enough room for good listing gains due to valuation gap with listed peers.

The ₹72.17 crore issue was subscribed 320 times the shares on offer, with bumper applications from retail as well as institutional investors. It raised ₹21.5 crore from three anchor investors like Saint Capital Fund, Chhatisgarh Investments and Neomile Growth Fund - Series I; ahead of opening the issue to the public.

The listing performance of 2024’s market debuts have been mixed due volatile market conditions. The last three listings, however, gave tepid listing gains, with small finance banks seeing share prices falling below their issue prices. However, the tranche before that saw good listing gains. Apeejay Surrendra Parks, BLS E-Services and Nova Agritech have given positive returns to investors.

Here are the listing gains of the last few market debuts

Company	Listing gains
Entero Healthcare	-8.6%
Rashi Peripherals	3%
Capital Small Finance Bank	-7%
Jana Small Finance Bank	-4%
Apeejay Surrendra Parks	31%
BLS E-Services	129%
Nova Agritech	39%

The Haryana-based manufacturer of high-quality steel tubes and pipes’ IPO is a completely fresh issue. It intends to use it to fund its working capital requirements.

The company operates two manufacturing facilities and one warehouse with a total capacity of 2,23,160 million tonne per annum in Maharashtra, Telangana and Haryana. It sSupplies its products to western and southern market companies in Maharashtra, Gujarat, Madhya Pradesh, Telangana, Karnataka and Tamil Nadu.

The company has plans to expand its operations by setting up a manufacturing unit with a capacity of 1,20,000 MTPA in Orissa and expanding the current unit’s capacity in Telangana from 96,000 MTPA to 1,52,000 MTPA.

VSTL has also entered into an agreement with Jindal Pipes Limited in April 2023. As part of the agreement, the company manufactures and supplies finished goods worth 1,00,000 MTPA to Jindal Pipes, which sells the products under the brand name Jindal Star.

“The key strength of the company comes from the association with Jindal Pipes. Its capacity expansion gives long term visibility in terms of long term,” said Rajan Shinde, research analyst, Mehta Equities who gave it a ‘subscribe’ rating to the issue.