Shares of Beezaasan Explotech Limited, an explosives manufacturing company, were listed on the BSE SME platform at ₹146 per share, representing a 17% discount from its issue price of ₹175. This marked the company’s official listing after its Book Built Issue amounting to ₹59.93 crores, which consisted of a fresh issue of 34.24 lakh shares. The subscription period for the Beezaasan Explotech IPO ran from February 21, 2025, to February 25, 2025, with the allotment finalized on February 27, 2025. The listing date was set for March 3, 2025, and the final listing price fell at ₹146, lower than the issue price.

Details of the Beezaasan Explotech IPO

The Beezaasan Explotech IPO was priced in the range of ₹165 to ₹175 per equity share, and at the higher end of the price band, the company had set a market capitalization of ₹227.15 crores. With a lot size of 800 shares, retail investors were required to invest a minimum of ₹1,40,000, while High Net-Worth Individuals (HNIs) had to invest in a minimum of two lots, amounting to ₹2,80,000.

During the subscription period, the IPO saw a 5.11x subscription on its final day, indicating strong investor interest despite the initial discount at listing. In addition, Beezaasan Explotech raised ₹16.94 crores from anchor investors, with a price of ₹175 per share, showing initial backing from large investors.

About Beezaasan Explotech Limited

Beezaasan Explotech, with 60 years of experience in the explosives industry, focuses on manufacturing and supplying explosives and accessories, including slurry explosives, emulsion explosives, and detonating fuses. The company operates manufacturing units in Gujarat, with a facility spanning over 40,68,876.50 sq. ft.. Its products are primarily utilized in industries like cement, mining, and defense, and are used by public sector undertakings such as the Border Roads Organization.

The company’s innovative solutions are developed through years of experience in meeting the stringent demands of its clients, ensuring high safety standards. With an aim to expand, Beezaasan Explotech plans to utilize the proceeds from the IPO to fund capital expenditure for facility expansions and product innovation.

Use of Proceeds

Beezaasan Explotech has earmarked ₹387.47 lakhs for expanding the existing manufacturing unit, including civil construction for new explosive plants. An additional ₹2,304.30 lakhs will be used for purchasing new plant and machinery. Furthermore, the company plans to allocate ₹1,800 lakhs to repay existing borrowings, strengthening its financial position.

Risk Factors

As the company expands, it faces several risks:

1. Quality Compliance Risk: Strict regulations in manufacturing explosives require continuous compliance with quality standards, failing which future orders may be impacted.
2. Demand Dependency: A significant portion of revenue comes from slurry explosives, and any downturn in demand could affect performance.
3. Geographical Concentration: A major share of sales is from Gujarat and Rajasthan, and any adverse developments in these regions could negatively affect revenue.
4. Raw Material Procurement: Reliance on suppliers in Gujarat and Maharashtra makes the company vulnerable to disruptions in supply chains.

Industry Context

The explosives industry in India plays a crucial role in sectors like mining, infrastructure, and defense. India's industrial explosives production is significant, and with increasing demand from both mining and construction sectors, the market is expected to grow. The company operates in a rapidly expanding Indian manufacturing sector, benefitting from favorable government initiatives and a strong domestic demand for explosives used in various critical industries.

As the explosives market continues to expand, Beezaasan Explotech’s IPO reflects its growing role in providing world-class products in the Indian manufacturing landscape. The company’s successful listing on the BSE SME platform marks an important milestone in its journey toward becoming a leading player in the explosives manufacturing industry.

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