Scoda Tubes Limited, an established manufacturer of stainless steel tubes and pipes based in India, is launching its Initial Public Offering (IPO) from May 28 to May 30, 2025. The company, with over 14 years of industry experience, operates in two major product categories — seamless tubes/pipes and welded tubes/pipes — under five distinct product lines including stainless steel seamless pipes, tubes, “U” tubes, instrumentation tubes, and welded tubes. This IPO presents an opportunity for investors to gain exposure to a growing steel tubes sector.

IPO Details and Subscription

The Scoda Tubes IPO is a Book Built Issue with a fresh issue size of ₹220.00 Crores, consisting of approximately 157.14 lakh equity shares. The price band is set between ₹130 to ₹140 per share, with a market capitalization of ₹838.73 Crores based on the upper price band. Investors can apply in lots of 100 shares, which means the minimum investment for retail investors is ₹14,000, while High Net Worth Individuals (HNIs) need to invest in a minimum of 15 lots or ₹2,10,000.

The IPO will be listed on both the BSE and NSE, with the allotment expected on or around June 2, 2025, and shares tentatively listing on June 4, 2025.

Grey Market Premium (GMP) and Anchor Investors

The Grey Market Premium for Scoda Tubes IPO stands at ₹15, indicating an expected listing gain of approximately 10.7% based on the IPO price of ₹140. However, since grey market trading is informal and unregulated, this is only an educational indicator of demand and not a guarantee of returns.

The company successfully raised ₹65.99 Crores from anchor investors, who were allotted 47,14,200 shares at ₹140 per share. Anchor investors’ involvement typically signals confidence in the issue and can provide stability in the initial trading days.

Financial Performance Highlights

Scoda Tubes has demonstrated steady financial growth over recent years:

• Revenue from operations increased from ₹1,950.53 Million in FY22 to ₹4,024.88 Million in FY24, reflecting strong business expansion.

• EBITDA grew from ₹110.14 Million in FY22 to ₹614.18 Million in FY24, indicating improving operational efficiency and profitability.

• Profit after tax surged from ₹16.36 Million in FY22 to ₹183.00 Million in FY24, showing significant bottom-line growth.

For the period ending December 31, 2024, revenue stood at ₹3,634.80 Million with EBITDA of ₹629.37 Million and PAT of ₹249.14 Million.

Valuation and Investment Perspective

The company’s pre-issue EPS for FY24 is ₹4.6, and the post-issue EPS is ₹3.05. The pre-issue Price/Earnings (P/E) ratio is 30.43x, while the post-issue P/E ratio increases to 45.83x, compared with the industry P/E of 31x. Return metrics are strong with ROCE at 15.92% and ROE at 28.77% for FY24.

The annualized EPS based on recent financial data is ₹8.10, with a PE ratio of 17.26x, indicating a fairly valued IPO with good growth potential.

Objectives of the IPO

The net proceeds from the IPO will be primarily utilized for:

1. Capital expenditure of ₹769.90 Million to expand production capacity for seamless and welded tubes and pipes.

2. Funding incremental working capital requirements amounting to ₹1,100 Million.

3. General corporate purposes to strengthen overall business operations.

How to Check IPO Allotment Status

Investors can check their allotment status online on or after June 2, 2025, through the registrar's website by:

• Visiting the IPO allotment status page,

• Selecting Scoda Tubes Limited IPO from the dropdown,

• Entering application number, PAN, or DP Client ID,

• Submitting the details to view allotment results.

Conclusion and Recommendation

Scoda Tubes IPO offers exposure to a niche segment of stainless steel tubes manufacturing backed by a strong management team and steady financial growth. The company’s focus on capacity expansion and working capital enhancement aligns with its growth strategy. Considering the Grey Market Premium of ₹15 and expected listing gains of over 10%, investors seeking listing profits may find this IPO attractive, though it is suitable for risk-tolerant investors given industry cyclicality and valuation multiples.

The Upcoming IPOs in this week and coming weeks are 3B Films, Victory Electric Vehicles International, Wagons Learning.

The Current active IPO are N R Vandana Tex Industries, Scoda Tubes, Neptune Petrochemicals, Blue Water Logistics, Astonea Labs, Nikita Papers, Prostarm Info Systems, Aegis Vopak Terminals, Schloss Bangalore.

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