The Malpani Pipes and Fittings IPO debuted on BSE SME on February 5, 2025, listing at an opening price of ₹109, a significant 21.11% premium over the issue price of ₹90 per equity share. The strong debut reflects positive investor sentiment, particularly given the company’s established presence in the precision plastics industry and the demand for products like HDPE Pipes, MDPE Pipes, Drip Irrigation Pipes, and PE Gas Pipes.

About Malpani Pipes and Fittings Limited

Malpani Pipes and Fittings specializes in manufacturing a wide range of plastic pipes, including HDPE, MDPE, Sprinkler, Drip Irrigation, PE Lateral, PE Sewerage, and PE Gas Pipes. These products serve critical sectors such as agriculture, irrigation, water supply, and gas distribution, establishing the company as a key player in the precision plastics industry.

The company’s focus on high-quality standards and advanced manufacturing processes has earned it recognition in the industry, and it is expected to continue expanding as the demand for irrigation systems and water management solutions grows across India.

IPO Details and Subscription

The Malpani Pipes and Fittings IPO was a book-built issue, raising ₹25.92 Crores through the issuance of 28.80 Lakh shares. The price band for the IPO was set between ₹85 to ₹90 per share, with a lot size of 1,600 shares. Retail investors were required to invest a minimum of ₹1,44,000 for one lot, and HNIs needed to invest ₹2,88,000 for two lots.

The IPO saw massive demand, with a 39.40x subscription on the last day of the subscription period. The grey market premium (GMP) for the IPO stood at ₹19, which indicated strong listing gains of 21.11%. The market capitalization of Malpani Pipes and Fittings at the issue price of ₹90 stood at ₹96.99 Crores.

Grey Market Premium and IPO Review

The GMP for the Malpani Pipes IPO was reported at ₹19, signaling an expected listing price of ₹109, which marks a 21.11% premium from the issue price of ₹90. The strong GMP reflects positive market sentiment towards the company, especially given its steady growth in revenues and profits over recent years.

Key financial metrics indicate that the IPO is fairly priced, with a P/E ratio of 2.42x (pre-issue) and 13.11x (post-issue), compared to the industry average P/E of 26x. The company's ROE for FY24 is 71.52%, and its ROCE stands at 21.74%, demonstrating efficient capital utilization.

Objectives of the IPO

The company intends to use the net proceeds of the IPO for the following purposes:

1. ₹350 Lakhs for capital expenditure to purchase machinery.
2. ₹1,500 Lakhs to repay debt and improve the company’s financial stability.
3. General corporate purposes.

Key Financials

Malpani Pipes and Fittings has demonstrated strong financial growth, with revenues increasing from ₹3,493.67 Lakhs in FY 2022 to ₹14,116.23 Lakhs in FY 2023. For the period ending November 30, 2024, the company posted revenues of ₹8,454.55 Lakhs and a profit after tax (PAT) of ₹509.19 Lakhs.

The EPS for FY 2024 is ₹37.17 pre-issue, which drops to ₹6.86 post-issue due to the dilution of shares. However, the company’s annualized EPS of ₹9.67 and P/E ratio of 9.30x indicate strong valuation potential compared to industry standards.

Conclusion and Recommendation

With a strong listing debut and positive grey market premium, the Malpani Pipes and Fittings IPO offers substantial listing gains for investors. The company’s robust financial performance, growth potential in the irrigation and water management sectors, and fair valuation make this IPO an attractive investment option.

We recommend investors consider applying to the Malpani Pipes and Fittings IPO for listing gains. For more information on the IPO and to stay updated, be sure to join our Telegram channels for real-time updates and investment tips.

The Upcoming IPOs in this week and coming weeks are Chamunda Electricals.

The Current active IPO are Malpani Pipes And Fittings and Dr. Agarwal's Health Care.

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