Swastika Castal Limited is launching its Initial Public Offering (IPO) on July 21, 2025, with the offer closing on July 23, 2025. This IPO will be listed on the BSE SME platform and is entirely a fresh issue of 21.64 lakh equity shares, aggregating to ₹14.07 crores.

IPO Highlights

The IPO is being offered at a fixed price of ₹65 per share. The minimum lot size for investors is 2,000 shares, meaning retail investors need to apply for at least 4,000 shares (2 lots), translating to an investment of ₹2.6 lakhs. For High Net-Worth Individuals (HNIs), the minimum application is 3 lots (6,000 shares) amounting to ₹3.9 lakhs.

Here is a summary of the key IPO terms:

• IPO Date: July 21 to July 23, 2025

• Price per share: ₹65

• Face Value: ₹10

• Issue Size: ₹14.07 crore (21.64 lakh shares)

• Lot Size: 2,000 shares

• Minimum Investment (Retail): ₹2,60,000

• Market Maker: Horizon Financial Consultants Pvt. Ltd.

• Registrar: Accurate Securities & Registry Pvt. Ltd.

• Lead Manager: Horizon Management Pvt. Ltd.

• Tentative Listing Date: July 28, 2025

IPO Reservation Structure

Swastika Castal IPO has a structured reservation as per standard BSE SME guidelines:

• Retail Individual Investors (RII): 10.28 lakh shares (47.50%)

• Non-Institutional Investors (NII): 10.26 lakh shares (47.41%)

• Market Maker: 1.10 lakh shares (5.08%)

Note: Bidding at cut-off price is not allowed for any category, which is important to remember while applying.

Company Background – Swastika Castal Ltd.

Incorporated in 1996, Swastika Castal Limited operates in the aluminum casting sector. The company has built a reputation for high-quality manufacturing through techniques like:

• Sand casting (up to 250 kg)

• Gravity casting (up to 80 kg)

• Centrifugal casting

The company also operates its own in-house heat treatment plant, offering quality control and cost savings.

Products Serve Multiple Sectors:

• Electrical Equipment & Transmission

• Railways & Diesel Engines

• Industrial Applications like air compressors and insulators

Promoter Background

The promoters of Swastika Castal Ltd. are Varun Sharda and Indra Sharda. The pre-issue shareholding was 100%, which will reduce to 73.49% post-issue, resulting in an equity dilution of 26.51%.

Objects of the Issue

The company plans to use the net proceeds of ₹10 crore for:

1. Capital expenditure on Plant & Machinery and Building Construction – ₹5 crore

2. Working Capital requirements – ₹5 crore

The rest will be allocated toward issue expenses.

Financial Performance

Swastika Castal has shown robust financial growth in recent years, especially in FY 2024–25, with a 305% jump in PAT and 30% revenue growth.

Key Financial Ratios and Valuations

Swastika Castal shows strong returns and operational efficiency based on FY 2025 data:

• Return on Equity (ROE): 28.17%

• Return on Capital Employed (ROCE): 32.74%

• PAT Margin: 8.88%

• Debt/Equity Ratio: 0.85

• Price to Book (P/B) Ratio: 3.66

• Market Cap Post IPO: ₹53.07 crore

• P/E Ratio:

  • Pre IPO: 14.8x

  • Post IPO: 20.14x

Note: A significant jump in FY25 PAT raises questions about sustainability.

IPO Lot Size and Investment Table

Swastika Castal IPO Timeline

Strengths of Swastika Castal Ltd.

• Diversified Product Portfolio: Serves power, railway, and industrial sectors

• Experienced Promoters with over two decades in aluminum casting

• Global Client Base ensures business resilience

• Strong Financial Growth and improved profitability

• In-house Heat Treatment enhances quality and cost efficiency

Concerns and Risk Factors

• The sudden spike in FY25 profit could raise sustainability concerns

• The IPO appears aggressively priced based on P/E ratio

• No anchor investor or institutional participation known

• SME Listing may affect liquidity and long-term trading volume

Expert Review and Recommendation

According to market analysts like Dilip Davda, while Swastika Castal shows excellent growth and technical competence, the valuation appears high, and FY25's profits may not be sustainable. The small post-issue equity size also suggests a long gestation period for BSE Main Board migration.

Recommendation: Cautious investors with surplus funds may consider applying for long-term gains.

Disclaimer:
This analysis is for educational and informational purposes only. It does not constitute investment advice or a solicitation to buy or sell any securities. Investors should perform their own due diligence or consult a SEBI-registered financial advisor before making any investment decisions. All data is based on information available as of the publication date and may be subject to change.

The Upcoming IPOs in this week and coming weeks are Indiqube Spaces, GNG Electronics, Brigade Hotel Ventures, TSC India, Patel Chem Specialities, Monarch Surveyors & Engineering Consultants, TSC India, Swastika Castal, Savy Infra, NSDL.

The Current active IPO are Monika Alcobev.

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