Scoda Tubes Limited is an established manufacturer of stainless steel tubes and pipes based in India with over 14 years of industry experience. The company offers a broad product portfolio classified into two main categories: seamless tubes and pipes, and welded tubes and pipes. Their products are marketed under five distinct product lines including stainless steel seamless pipes, seamless tubes, seamless U tubes, instrumentation tubes, and welded tubes and U tubes. These products cater to various industrial applications requiring high-quality stainless steel tubes.

The company is launching its Initial Public Offering (IPO) as a Book Built Issue amounting to ₹220 crore, entirely through a fresh issue of 157.14 lakh equity shares. The subscription window for the IPO will be open from May 28, 2025, to May 30, 2025. The allotment is expected to be finalized on or about June 2, 2025. Scoda Tubes shares will be listed on both the BSE and NSE, with the tentative listing date set for June 4, 2025.

The IPO price band has been fixed between ₹130 and ₹140 per equity share. At the upper price band of ₹140, the company’s market capitalisation will be approximately ₹838.73 crore. The IPO lot size is 100 shares, which means retail investors are required to invest a minimum of ₹14,000. High Net Worth Individuals (HNIs) are required to apply for a minimum of 15 lots (1,500 shares), amounting to ₹2,10,000.

MONARCH NETWORTH CAPITAL LIMITED is the book running lead manager for the IPO, while MUFG Intime India Private Limited is the registrar for the issue.

Financial Performance and Growth

Scoda Tubes has shown consistent growth in financial performance over the past few years. Revenues from operations were ₹3,634.80 million for the period ended December 31, 2024, compared to ₹4,024.88 million in FY24, ₹3,077.85 million in FY23, and ₹1,950.53 million in FY22. EBITDA increased steadily to ₹629.37 million for the period ended December 2024, up from ₹614.18 million in FY24, ₹374.41 million in FY23, and ₹110.14 million in FY22. Profit after tax also showed a strong growth trajectory with ₹249.14 million for the period ended December 31, 2024, compared to ₹183.00 million in FY24, ₹103.36 million in FY23, and ₹16.36 million in FY22.

Key performance indicators include a pre-issue Earnings Per Share (EPS) of ₹4.6 and a post-issue EPS of ₹3.05 for FY24. The pre-issue Price to Earnings (P/E) ratio stands at 30.43 times, rising to 45.83 times post-issue, which is higher than the industry average P/E ratio of 31 times. The company reported a Return on Capital Employed (ROCE) of 15.92%, Return on Equity (ROE) of 28.77%, and Return on Net Worth (RoNW) of 28.77% for FY24. The annualised EPS based on the latest financials is ₹8.10, with a P/E ratio of 17.26 times, indicating the IPO is priced fairly relative to its financial strength and growth potential.

Management and Leadership

The promoters and senior management team at Scoda Tubes bring considerable experience in the stainless steel seamless and welded tubes industry, with an average experience of around 8 years. The promoter group includes Samarth Patel, Jagrutkumar Patel, Ravi Patel, Saurabh Patel, and Vipulkumar Patel, who collectively contribute expertise in marketing, procurement, finance, accounting, and customer relationship management. Their combined industry knowledge and operational experience are expected to drive the company’s future growth.

Grey Market Premium and Listing Outlook

The Grey Market Premium (GMP) for Scoda Tubes IPO currently stands at ₹15, reflecting an expected listing gain of approximately 10.7%. It is important to note that GMP is based on informal trading and does not guarantee actual listing performance. It should be used for educational purposes only. The official share price will be determined upon listing on the stock exchanges.

Given the company’s consistent financial performance and valuation metrics, the IPO could offer attractive listing gains for investors with a moderate risk appetite. Risk-aware investors may consider applying, but must weigh the market and industry risks associated with the stainless steel manufacturing sector.

For further details, investors may contact:
MONARCH NETWORTH CAPITAL LIMITED (Book Running Lead Manager)
MUFG Intime India Private Limited (Registrar)

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