Sambhav Steel Tubes Limited, a notable name in the Indian steel manufacturing sector, is launching its Initial Public Offering (IPO) on June 25, 2025, with the issue closing on June 27, 2025. The IPO size stands at ₹540 crore, comprising a fresh issue of ₹440 crore and an offer for sale (OFS) worth ₹100 crore. The price band has been fixed at ₹77 to ₹82 per share, and the tentative listing date is scheduled for July 2, 2025, on both the BSE and NSE.

Known for its specialization in electric resistance welded (ERW) steel pipes and structural tubes (hollow sections), Sambhav Steel Tubes Limited has built a strong position in the domestic market. As of March 31, 2024, the company ranked among the leading manufacturers in India based on installed production capacity.

IPO STRUCTURE AND KEY DETAILS

The IPO will see the issuance of:

• Fresh Issue: 536.58 lakh shares raising ₹440 crore

• Offer for Sale (OFS): 121.95 lakh shares raising ₹100 crore

At the upper band price of ₹82, the market capitalisation of the company is expected to touch ₹2,416.21 crore.

• Lot Size: 182 shares

• Retail Minimum Investment: ₹14,924

• HNI Minimum Investment: 14 lots (2,548 shares) amounting to ₹2,08,936

The book running lead managers are Motilal Oswal Investment Advisors Limited and Nuvama Wealth Management Limited, while KFin Technologies Limited acts as the registrar to the issue.

GREY MARKET PREMIUM (GMP) – A CAUTIONARY SIGNAL

As per the latest available data on June 20, 2025, the Grey Market Premium (GMP) of Sambhav Steel Tubes IPO stands at ₹0. This implies no premium or discount is being offered in the grey market, which indicates lack of speculative demand and low expectations of listing gains. Investors should note that GMP is unregulated and reflects only informal sentiments.

OBJECTIVES OF THE IPO

Sambhav Steel Tubes intends to use the net proceeds from the IPO for the following objectives:

1. ₹390 crore for pre-payment or scheduled re-payment of certain outstanding borrowings

2. Remaining funds will be used for general corporate purposes

These proceeds aim to de-leverage the balance sheet, thereby improving liquidity and reducing interest burden, which could enhance profitability in the long run.

FINANCIAL PERFORMANCE SNAPSHOT

The company has showcased steady financial growth over recent years, reinforcing investor confidence in its operational capabilities.

• Revenue from Operations:

  • FY22: ₹8,207.53 million

  • FY23: ₹9,390.04 million

  • FY24: ₹12,893.75 million

  • 9M FY24 (ending Dec 31): ₹10,188.06 million

• EBITDA:

  • FY22: ₹1,259.19 million

  • FY23: ₹1,190.84 million

  • FY24: ₹1,634.90 million

  • 9M FY24: ₹1,090.81 million

• Profit After Tax (PAT):

  • FY22: ₹721.08 million

  • FY23: ₹603.83 million

  • FY24: ₹824.39 million

  • 9M FY24: ₹406.85 million

The numbers point to consistent and upward growth trends, backed by robust operating performance and sound capital allocation.

VALUATION METRICS

• Pre-Issue EPS (FY24): ₹3.79

• Post-Issue EPS (FY24): ₹2.80

• Annualised EPS: ₹1.84

• Pre-Issue P/E Ratio: 21.64x

• Post-Issue P/E Ratio: 29.31x

• Annualised P/E Ratio: 44.54x

• Industry P/E Ratio: ~39x

• Return on Capital Employed (ROCE): 17.66%

• Return on Equity (ROE): 25.42%

• Return on Net Worth (RoNW): 25.42%

The valuation appears fairly priced considering its post-issue P/E of 29.31x compared to the industry average of 39x. The high ROE and RoNW signal efficient use of capital, but the annualised EPS shows moderation, reflecting growth concerns.

COMPANY BACKGROUND & PROMOTER STRENGTH

Sambhav Steel Tubes Limited is promoted by Brijlal Goyal, Suresh Kumar Goyal, and Vikas Kumar Goyal, who bring over 20 years of experience in the steel manufacturing industry. The executive team also includes Bhavesh Khetan, Executive Director and COO, who has significant experience in managing large-scale operations.

The company's strategic presence in the steel pipe and structural tube segments supports demand from sectors like construction, infrastructure, and manufacturing, which are poised for growth under India’s ongoing capital expenditure cycle.

IPO LISTING & ALLOTMENT DETAILS

The allotment for Sambhav Steel Tubes IPO is expected to be finalized on June 30, 2025, with shares likely to be listed on July 2, 2025. Investors can check their allotment status by:

• Visiting the IPO allotment page on the registrar’s website (KFin Technologies)

• Selecting Sambhav Steel Tubes Limited IPO

• Entering Application Number, PAN, or DP Client ID

• Submitting the details to view the allotment status

This process helps investors confirm whether their bid for shares was successful.

FINAL VERDICT – INVEST OR AVOID?

While Sambhav Steel Tubes IPO is backed by a solid track record, steady profitability, and efficient operations, several factors suggest muted listing potential:

• Zero GMP indicates no expected listing gains

• Valuation is fair but not cheap, offering limited upside

• Sector outlook is stable, but macroeconomic headwinds could influence demand

Given these dynamics, the IPO may not be suitable for short-term listing gains. However, long-term investors with interest in India’s growing infrastructure and manufacturing ecosystem might consider entering post-listing after evaluating initial performance.

This article incorporates every key aspect like Sambhav Steel Tubes IPO latest news, subscription status, GMP trends, allotment updates, financial performance, valuation comparisons, and IPO objectives to give a complete overview for retail and institutional investors.

Disclaimer: This analysis is for educational and informational purposes only and does not constitute investment advice or a recommendation to buy or sell securities. Always consult with a SEBI-registered advisor before making investment decisions. Investing in IPOs and equity markets involves market risks.

The Upcoming IPOs in this week and coming weeks are Pushpa Jewellers, Cedaar Textile, Adcounty Media India, Marc Loire Fashions, Indogulf Cropsciences, Moving Media Entertainment, Rama Telecom, Supertech EV, Valencia India, Neetu Yoshi, PRO FX Tech, Suntech Infra Solutions, Ace Alpha Tech, Sambhav Steel Tubes, HDB Financials.

The Current active IPO are  Abram Food, Shri Hare-Krishna Sponge Iron, Icon Facilitators, Globe Civil Projects, Ellenbarrie Indutrial Gases, Kalpataru,AJC Jewel, Aakaar Medical Technologies, Safe Enterprises Retail Fixtures, Mayasheel Ventures.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.