Malpani Pipes and Fittings Limited, a premier player in the precision plastics industry, is renowned for its extensive range of products, including HDPE Pipes, MDPE Pipes, Sprinkler Pipes, Drip Irrigation Pipes, PE Lateral Pipes, PE Sewerage Pipes, and PE Gas Pipes. The company has built a strong reputation as a leading manufacturer and supplier of high-quality plastic pipes used in various sectors such as agriculture, water management, and gas distribution.

The Malpani Pipes and Fittings IPO is a Book Built Issue amounting to ₹25.92 crores, consisting entirely of a fresh issue of 28.80 lakh shares. The price band for the IPO is set between ₹85 to ₹90 per share, with a market capitalization of ₹96.99 crores at the upper price band. The subscription period will run from January 29, 2025, to January 31, 2025, with a tentative listing date of February 5, 2025.

Business Overview

Malpani Pipes specializes in precision plastic pipes essential for a wide range of applications, particularly in irrigation systems, sewerage, and gas distribution. The company’s products are widely used in agricultural, industrial, and municipal projects, establishing a significant footprint in the market.

IPO Financial Highlights

• Price Band: ₹85 to ₹90 per equity share
• Market Capitalization: ₹96.99 crores at ₹90 per share
• Lot Size: 1,600 shares; Minimum Investment for Retail Investors: ₹1,44,000; HNIs: ₹2,88,000 (2 lots)
• Book Running Lead Manager: INTERACTIVE FINANCIAL SERVICES LIMITED
• Registrar: BIGSHARE SERVICES PRIVATE LIMITED

Financial Performance

• Revenue from Operations (₹ Lakh): FY24 - ₹8,454.55; FY23 - ₹14,116.23
• EBITDA (₹ Lakh): FY24 - ₹965.38; FY23 - ₹1,349.09
• Profit After Tax (PAT) (₹ Lakh): FY24 - ₹509.19; FY23 - ₹739.72

Grey Market Premium (GMP)

The Grey Market Premium (GMP) for the Malpani Pipes IPO is ₹19, or 21.11% at the upper end of the price band. This indicates a strong potential for listing gains. However, GMP is based on unregulated market trends, so investors should approach it with caution.

Subscription and Allotment Details

The IPO will open for subscription on January 29, 2025. The IPO allotment date is February 3, 2025, and investors can check the allotment status online by following these steps:

1. Visit the IPO allotment status page.
2. Select Malpani Pipes and Fittings IPO from the dropdown list.
3. Enter your application number, PAN, or DP Client ID.
4. Submit to check your allotment status.

IPO Objectives

The company intends to utilize the net proceeds for the following purposes:

1. ₹350 Lakhs for capital expenditure to purchase new machinery.
2. ₹1,500 Lakhs for repayment of debt.
3. General corporate purposes.

Company Leadership

Malpani Pipes is led by experienced professionals with a solid track record in the precision plastics industry. Their leadership ensures the company continues to innovate and expand its product offerings, helping it maintain a competitive edge in the market.

Valuation and Conclusion

With a pre-issue P/E ratio of 2.42x and a post-issue P/E ratio of 13.11x, the IPO appears to be reasonably priced, especially in comparison to the industry P/E ratio of 26x. The GMP of 21.11% further suggests strong potential for listing gains. Given the company's robust financials, steady growth trajectory, and fair valuation, we recommend investors apply for the Malpani Pipes and Fittings IPO to potentially benefit from listing gains.

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