Super Iron Foundry Limited, a prominent player in the iron and steel foundry industry, has launched its Initial Public Offering (IPO) today, March 11, 2025. This IPO presents an opportunity for investors to participate in the company’s growth trajectory. Let’s delve into the specifics of this offering, including the issue price, subscription details, Grey Market Premium (GMP), and other pertinent information.
Company Overview
Established in 1988, Super Iron Foundry Limited specializes in casting and manufacturing products essential for infrastructure, automotive, agriculture, and railway sectors.
Their product portfolio includes municipal castings, ductile iron pipe fittings, automotive castings, agricultural castings (such as rollers and crosskills), railway castings, and cast-iron counterweights.
The company boasts a modern robotic production facility in Durgapur, West Bengal, ensuring quality and sustainability in its offerings.
IPO Details
- Issue Type: Fixed Price Issue
- Issue Size: 63,01,200 equity shares, aggregating up to ₹68.05 crore
- Face Value: ₹10 per equity share
- Issue Price: ₹108 per equity share
- Lot Size: 1,200 shares
- Minimum Investment: ₹1,29,600
- Listing Exchange: BSE SME
- Issue Open Date: March 11, 2025
- Issue Close Date: March 13, 2025
- Listing Date: March 19, 2025
The IPO is entirely a fresh issue, with no Offer for Sale (OFS) component. The net proceeds from the offering are earmarked for funding the company’s working capital requirements, repaying or pre-paying certain borrowings, and general corporate purposes.
Subscription Status
On the first day of the IPO, Super Iron Foundry received a subscription of 25%. The retail portion was subscribed 48%, while the Non-Institutional Investors (NII) segment saw a 2% subscription. Specifically, the company received bids for 14,96,400 shares against the 59,85,601 shares on offer.
Grey Market Premium (GMP)
The Grey Market Premium (GMP) is an informal indicator of the market’s interest in an IPO before its official listing. As of March 11, 2025, the GMP for Super Iron Foundry IPO stood at ₹36.
This suggests that shares were trading at a premium of ₹36 in the grey market, indicating an estimated listing price of ₹144 per share, which is 33.33% higher than the IPO price of ₹108.
Financial Performance
Super Iron Foundry has demonstrated consistent growth over the years. Here’s a snapshot of their financial performance:
| Particulars | March 31, 2022 | March 31, 2023 | March 31, 2024 | December 31, 2024 |
|---|---|---|---|---|
| Total Revenue (₹ Cr) | 132 | 126 | 157 | 95 |
| Profit After Tax (₹ Cr) | 1 | 1 | 4 | 10 |
| Net Worth (₹ Cr) | 51.33 | 52.62 | 56.56 | 70.59 |
| Total Borrowings (₹ Cr) | 125.72 | 120.44 | 118.63 | 110.96 |
The company’s revenue and profitability have shown an upward trend, reflecting its robust operational capabilities and market presence.
Peer Comparison
In terms of valuation, Super Iron Foundry’s listed peers include Bhagwati Autocast Ltd, with a Price-to-Earnings (P/E) ratio of 20.40, and Universal Auto Foundry Ltd, with a P/E ratio of 79.10.
Investors often consider such metrics to assess the relative valuation and growth prospects of companies within the same industry.
Key Considerations for Investors
- Industry Positioning: Super Iron Foundry’s diverse product range caters to essential sectors like infrastructure, automotive, and agriculture, positioning it well for sustained demand.
- Modern Manufacturing: The company’s investment in a robotic production facility underscores its commitment to quality and efficiency, potentially leading to better profit margins.
- Financial Health: The consistent growth in revenue and profitability, coupled with a reduction in borrowings, indicates sound financial management.
- GMP Indicator: A positive GMP reflects favorable market sentiment; however, investors should exercise caution, as GMP is an unofficial metric and can be volatile.
Conclusion
The Super Iron Foundry IPO offers investors an opportunity to invest in a company with a solid track record, modern manufacturing capabilities, and a presence in critical sectors. While the initial subscription figures and GMP are encouraging, potential investors should conduct thorough due diligence, considering both the company’s fundamentals and broader market conditions, before making investment decisions.
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