Ellenbarrie Industrial Gases Limited (EIGL), a pioneer in India's industrial gases sector, recently closed its ₹852.53 crore IPO with tremendous demand. The IPO, which ran from June 24 to June 26, 2025, was subscribed 22.19 times overall, indicating strong institutional and retail interest.

However, despite the overwhelming subscription, analysts caution retail investors due to the absence of listing day grey market premiums (GMP) and relatively expensive valuations compared to industry benchmarks.

Let’s dive into a comprehensive analysis of this IPO to help investors make an informed decision.

About Ellenbarrie Industrial Gases Limited (EIGL)

Established over 50 years ago, Ellenbarrie Industrial Gases is one of the oldest operational players in India’s industrial gases market. It is now the largest Indian-owned industrial gases company in terms of installed manufacturing capacity, revenue, and profitability as of FY24.

EIGL operates one of the largest oxygen plants in India, with a production capacity of 1,250 TPD (Tons Per Day) as of March 31, 2024. Its product range includes oxygen, nitrogen, argon, and other industrial gases serving sectors like steel, healthcare, pharmaceuticals, and chemicals.

IPO Structure and Timeline

The Ellenbarrie IPO was a book-built issue of ₹852.53 crore, consisting of:

• Fresh Issue: ₹400 crore (1 crore equity shares)

• Offer for Sale (OFS): ₹452.53 crore (1.13 crore equity shares)

IPO Timeline:

• Open Date: June 24, 2025

• Close Date: June 26, 2025

• Allotment Date: June 27, 2025 (Friday)

• Listing Date: Tentatively on July 1, 2025 (Tuesday)

• Listing Exchanges: NSE & BSE

IPO Price Band and Investment Requirements

• Price Band: ₹380 to ₹400 per share

• Lot Size: 37 shares

• Minimum Investment (Retail): ₹14,800

• Minimum Investment (HNI): 14 lots or 518 shares amounting to ₹2,07,200

• Market Capitalisation at ₹400/share: ₹5,637.42 crore

Use of IPO Proceeds

The company plans to utilise net proceeds from the fresh issue of ₹400 crore as follows:

1. ₹210 crore towards repayment/prepayment of certain borrowings

2. ₹104.5 crore for setting up a new air separation unit at Uluberia-II plant with a capacity of 220 TPD

3. The balance for general corporate purposes

This capital infusion is expected to support capacity expansion, debt reduction, and overall growth in operations.

Anchor Investor Participation

EIGL garnered ₹255.75 crore from anchor investors ahead of the public issue.

• Shares allotted: 63,93,938

• Price: ₹400 per share (upper band)

This shows confidence from institutional investors, often seen as a positive signal. The shares allotted were part of the Qualified Institutional Buyers (QIB) quota.

Subscription Status on Final Day

The IPO received an overwhelming response with 22.19x overall subscription as of 7:00 PM on June 26, 2025.

• QIBs: Likely subscribed heavily due to strong fundamentals and anchor participation

• Retail & HNIs: Actively participated despite flat GMP

This robust demand reflects broad-based interest across investor categories.

Grey Market Premium (GMP) Trend

As of June 20, 2025:

• GMP: ₹0

• IPO Price: ₹400

• Expected Listing Price: ₹400

⚠️ Note: GMP is entirely unofficial and depends on unregulated demand/supply. A flat GMP indicates no immediate speculative premium, often seen as a red flag for short-term gains.

Investors should rely on fundamentals and valuations rather than grey market trends.

Financial Performance Overview

The company has demonstrated steady financial growth over the past three fiscal years:

These figures indicate strong revenue growth, rising EBITDA margins, and increasing profitability.

Valuation & Key Metrics

Despite strong financials, valuation remains on the higher side:

• Pre-Issue EPS (FY24): ₹6.36

• Post-Issue EPS (FY24): ₹5.91

• Pre-Issue P/E Ratio: 62.89x

• Post-Issue P/E Ratio: 67.69x

• Industry P/E Ratio: 141x

• ROE (FY24): 16.88%

• RoNW: 24.97%

• ROCE: 13.71%

While these ratios are strong compared to most small-cap industrial peers, the high P/E multiple might concern short-term traders expecting upside on listing.

However, compared to the industry average P/E of 141x, the IPO could be seen as reasonably priced for long-term investors.

Allotment Process – How to Check Status

Investors can check their allotment status on KFin Technologies' IPO allotment portal from June 27, 2025, onwards:

1. Visit KFin Technologies IPO Allotment Page

2. Select Ellenbarrie Industrial Gases IPO

3. Enter PAN / Application Number / DP Client ID

4. Click submit to view allotment status

Successful applicants will have shares credited to their demat accounts before the listing date.

Lead Managers and Registrar

Book Running Lead Managers (BRLMs):

• Motilal Oswal Investment Advisors Limited

• IIFL Securities Limited

• JM Financial Limited

Registrar:
KFin Technologies Limited

These experienced intermediaries ensure a smooth IPO process and institutional outreach.

Should You Invest? Our Recommendation

Pros:

• Strong financial growth in revenue and profits

• Largest Indian-owned industrial gases company

• High ROE and RoNW

• QIB and anchor participation implies institutional confidence

• Long-term growth potential via capacity expansion

Cons:

• No GMP listing gain indication

• P/E ratio on the higher side

• Capital-intensive sector with heavy reliance on demand from steel and pharma

Verdict: Long-Term Hold, Avoid for Listing Gains

Given the flat GMP and high valuation, the IPO may not deliver immediate listing gains. But for long-term investors, the company’s fundamentals, growth prospects, and strong position in a capital-critical sector like industrial gases offer promising returns.

If you have a long-term investment horizon, Ellenbarrie Industrial Gases IPO may be worth holding. However, short-term traders looking for listing day profits should avoid.

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The Current active IPO are Neetu Yoshi, Adcounty Media India, Moving Media Entertainment, Valencia India, PRO FX Tech, Ace Alpha Tech, Indogulf Cropsciences, Suntech Infra Solutions, Rama Telecom, Supertech EV, Sambhav Steel Tubes, HDB Financials.

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