Shri Hare-Krishna Sponge Iron Limited, an integrated manufacturer of sponge iron and mild steel products, is currently witnessing a surge in market buzz as its IPO Grey Market Premium (GMP) trends positively. As of June 24, 2025, the GMP stands at ₹18–₹20, suggesting a potential listing gain of around 22%–25%.

This interest reflects the broader optimism around the metal and manufacturing sectors, especially in the SME IPO space, where companies with strong industrial fundamentals are finding favour among retail and HNI investors.

What is GMP and Why It Matters

The Grey Market Premium (GMP) is the amount at which IPO shares are trading unofficially before listing. Though unregulated and speculative, GMP often indicates investor sentiment, demand-supply dynamics, and potential listing premiums.

In the case of Shri Hare-Krishna Sponge Iron IPO, a consistent GMP in the ₹18–₹20 range reflects bullishness from grey market traders, often considered an early signal of IPO listing success.

Shri Hare-Krishna Sponge Iron IPO Details

• IPO Type: Book Built Issue (SME segment)

• Issue Size: ₹24.65 crore (approx)

• Price Band: ₹78 to ₹80 per equity share

• Lot Size: 1,600 shares

• Minimum Investment: ₹1,28,000 (Retail Investors)

• IPO Open Date: June 21, 2025

• IPO Close Date: June 25, 2025

• Tentative Listing: July 1, 2025

• Registrar: Skyline Financial Services Pvt Ltd

• Lead Manager: Hem Securities Ltd

• Market Maker: Hem Finlease Pvt Ltd

The IPO is entirely a fresh issue of 30.8 lakh shares, and the proceeds will be used for capex, working capital, and plant efficiency improvements.

Company Overview

Shri Hare-Krishna Sponge Iron Ltd, founded in 2007, operates manufacturing units in Chhattisgarh, a key steel and sponge iron belt. It produces:

• Sponge Iron

• MS Billets

• Structural Steel

• By-products like char and flue dust for power generation

The company has backward integration in sourcing iron ore and coal and is working to enhance furnace efficiency and expand installed capacity.

Financial Highlights

• Revenue (FY24): ₹108.2 crore

• Profit After Tax (FY24): ₹8.9 crore

• EBITDA Margin: ~14.5%

• Net Profit Margin: ~8.2%

• ROE: 19.7%

• ROCE: 18.5%

• Debt-to-Equity Ratio: 0.62

These metrics suggest solid financial performance, a lean capital structure, and healthy margins for an SME manufacturer.

GMP Trends and Investor Sentiment

A GMP of ₹18–₹20 over an IPO price of ₹80 implies a listing range of ₹98–₹100 per share. This performance is being driven by:

• Investor confidence in the steel and sponge iron sector

• Limited SME IPO supply this week

• Strong QIB and HNI interest observed in pre-subscription rounds

• Expectations of increased infra and construction activity boosting demand

However, investors must understand that GMP is not guaranteed and can fluctuate rapidly.

Peer Comparison

Key SME and listed peers include:

• Gallantt Ispat Ltd

• Shyam Metalics and Energy Ltd

• Vikas Ecotech (for alloy and iron subsegments)

While these players operate at larger scales, Shri Hare-Krishna's agile operations, regional dominance, and raw material sourcing advantages offer a competitive edge in the SME segment.

Risk Factors to Consider

• Volatility in raw material prices (iron ore, coal)

• High working capital requirements in steel manufacturing

• Environmental and compliance costs in sponge iron production

• Grey market trends may not reflect actual listing movement

Despite these risks, the company's consistent profits, solid asset base, and sector tailwinds offer strong investor appeal.

Disclaimer:
This article is for educational and informational purposes only and does not constitute financial advice. Investment decisions should be based on individual risk tolerance and consultation with SEBI-registered advisors. Market conditions are volatile and subject to change. Neither the author nor the platform is responsible for losses arising from use of this information.

The Upcoming IPOs in this week and coming weeks are Abram Food, PRO FX Tech, Suntech Infra Solutions, Shri Hare-Krishna Sponge Iron, Icon Facilitators, Ace Alpha Tech, Globe Civil Projects, Sambhav Steel Tubes, Ellenbarrie Indutrial Gases, Kalpataru, HDB Financials, AJC Jewel.

The Current active IPO are  Aakaar Medical Technologies, Safe Enterprises Retail Fixtures, Mayasheel Ventures, ArisInfra Solutions, Influx Healthtech.

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