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Sambhv Steel invites bids for ₹540 crore IPO: GMP 6%, should you subscribe?
Sambhv Steel Tubes IPO: The initial public offering (IPO) of Chhattisgarh-based steel pipe manufacturer Sambhav Steel Tubes will open for public bidding today, June 25. At the upper price band, the company aims to raise ₹540 crore.
Ahead of the opening of the issue, Sambhv Steel has raised ₹161.25 crore crore from 19 anchor investors at the upper price band of ₹82 per equity share. As the public issue opens for bidding, here are the key details of the Sambhv Steel Tubes IPO:
Sambhv Steel IPO is a book-built issue comprising a combination of fresh issue of 53.7 million equity shares, aggregating to ₹440 crore and offer-for-sale (OFS) of 12.2 million shares aggregating to ₹100 crore.
Sambhv Steel IPO lot size, price band
Sambhv Steel IPO is available at a price band of ₹77-82 per share, with a lot size of 182 shares. Accordingly, investors can bid for a minimum of one lot or 182 shares of Sambhv Steel and in multiples thereof.
The minimum amount required by a retail investor to bid for the IPO is ₹14,924. A retail investor can bid for a maximum of 13 lots or 2,366 shares, amounting to ₹1,94,012.
Sambhv Steel IPO grey market premium (GMP)
The unlisted shares of Sambhv Steel were commanding a modest premium in the grey market ahead of the opening of the public issue. Sources tracking unofficial market activities showed that Sambhv Steel shares were trading at around ₹87 per share, reflecting a grey market premium (GMP) of ₹5 or 6.1 per cent over the upper end of the issue price.
Sambhv Steel IPO allotment date, listing date
The three-day subscription window to bid for the issue will conclude on Friday, June 27, 2025. Following the closure of the subscription window, the basis of allotment of shares is likely to take place on Monday, June 30, 2025.
Shares of Sambhv Steel are scheduled to make their D-street debut on Wednesday, July 2, 2025, by listing on the BSE and NSE.
Sambhv Steel IPO registrar, lead manager
Kfin Technologies is th registrar for the issue. Nuvama Wealth Management and Motilal Oswal Investment Advisors are the book running lead managers
Sambhv Steel IPO objective
According to the red herring propectus (RHP), the company plans to use 390 crore from the net fresh issue proceeds for prepayment or scheduled re-payment of a portion of certain outstanding borrowings availed by the company. The remaining funds will be used for general corporate purposes.
Should you subscribe to the Sambhv Steel IPO?
SBI Securities - Subscribe for long-term
"The company is valued at an annualized EV/Ebitda multiple of 18.2x and a P/E multiple of 44.5x for 9MFY25, based on the upper price band and postissue capital," SBI Securities said in a research note.
According to analysts at SBI Securities, Sambhv Steel Tubes stands out as one of the few players in India with a backward integration facility, enabling it to offer a diverse portfolio of premium products in a cost-efficient manner. The proceeds from the issue will be used primarily to reduce debt, thereby lowering interest costs and strengthening the balance sheet.
"With ramp up in capacity utilisation of CR coils (SS) and Pre-galvanised (GP) pipes expected over the next 2-4 quarters, margins are likely to expand. Strong industry tailwinds, robust backward integration and a growing portfolio of value-added products, the company is well-positioned for sustained growth. We recommend investors to
subscribe the issue at cut-off price with a long-term investment horizon," the brokerage said.
About Sambhv Steel Tubes
Sambhv Steel Tubes is the manufacturer of Electric Resistance Welded (ERW) steel pipers and structural tubes (hollow section) in India. It manufactures a range of finished products including ERW black pipes & tubes (hollow section), pre-galvanised (GP) pipes, Cold Rolled Full Hard (CRFH) Pipes & galvanised iron (GI) pipes and steel door frames, using intermediate products such as sponge iron, blooms/slabs & hot rolled (HR) coil, cold rolled (CR) coil (mild steel) and GP coils which are
manufactured in-house.
It is one of the two players in India manufacturing ERW steel pipes & tubes (along with hollow section pipes and tubes) using narrow-width HR coil, as of December 2024. The products are used across multiple sectors, including housing and infrastructure, water transportation, agriculture, automobile, telecommunications, oil & gas, engineering, solar energy, fire-fighting systems and support structures of conveyors.
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