Swastika Castal has emerged as a pioneer in the aluminium casting industry, renowned for setting high standards in precision, quality, and innovation. From its humble beginnings, the company has developed into a state-of-the-art manufacturing facility located in Gujarat, India, serving both domestic and international markets with its aluminium castings.

The company launched its Fixed Price IPO amounting to ₹14.07 crores, comprising a fresh issue of 21.64 lakh shares. The subscription window was open from July 21, 2025, to July 23, 2025, and the allotment is expected on July 24, 2025. The IPO shares will be listed on the BSE SME platform, with a tentative listing date set for Monday, July 28, 2025.

The issue price was fixed at ₹65 per equity share, placing the company’s market capitalization at ₹53.06 crores at the time of IPO. The IPO lot size is 2,000 shares, with individual investors required to subscribe to a minimum of two lots (4,000 shares) amounting to a minimum investment of ₹2,60,000.

The IPO was managed by Horizon Management Private Limited as the Book Running Lead Manager, while Accurate Securities & Registry Private Limited handled the registrar duties. The market maker for the issue is Horizon Financial Consultants Private Limited.

IPO Subscription and Market Sentiment

As of 11:00 AM on July 23, 2025, the IPO had been subscribed 3.04 times, reflecting moderate investor interest on the final day of subscription. The Grey Market Premium (GMP) for Swastika Castal IPO is ₹0, suggesting expectations of a flat listing price relative to the issue price. Since GMP depends on unregulated supply and demand in the grey market, it serves only an indicative purpose and does not guarantee listing performance.

Financial Performance Overview

The company’s financial performance has shown steady growth over the past three fiscal years:

• Revenue from operations increased from ₹2,441.34 lakh in FY23 to ₹3,031.28 lakh in FY25.

• EBITDA improved steadily from ₹240.64 lakh in FY23 to ₹520.62 lakh in FY25.

• Profit after Tax (PAT) grew significantly from ₹58.47 lakh in FY23 to ₹263.49 lakh in FY25.

These financials reflect the company’s consistent operational efficiency and growing market presence in the aluminium casting sector.

Valuation Metrics

Swastika Castal’s pre-issue Earnings Per Share (EPS) stands at ₹4.39, while the post-issue EPS is estimated at ₹3.32 due to dilution from the fresh issue. The pre-issue Price to Earnings (P/E) ratio is 14.80x, increasing to 20.14x post-issue, which remains below the industry average P/E of 23x.

Other key financial ratios for FY24 include:

• Return on Capital Employed (ROCE): 32.74%

• Return on Equity (ROE): 28.17%

• Return on Net Worth (RoNW): 24.70%

These indicators suggest the IPO is fairly priced compared to peers in the aluminium and manufacturing industry.

Use of IPO Proceeds

The net proceeds from the IPO will be used for:

1. ₹500 lakh for capital expenditure, including the purchase of plant and machinery and construction of sheds and buildings.

2. ₹550 lakh for working capital requirements, supporting day-to-day operations and project funding.

3. ₹159.68 lakh for general corporate purposes, allowing flexibility for future business needs.

These investments are aimed at enhancing production capacity and strengthening the company’s operational base to meet growing demand.

Promoters and Leadership

Promoted by Varun Sharda and Indra Sharda, the company benefits from their combined experience and leadership in the aluminium casting industry. With 18 years of industry experience, Varun Sharda has been instrumental in positioning Swastika Castal as a trusted and quality-focused player in the market.

IPO Allotment and Listing Process

The allotment status for investors is expected to be announced on July 24, 2025. Investors can verify their allotment on the registrar’s website by entering their application number, PAN, or DP Client ID. The shares are scheduled to list on BSE SME by July 28, 2025.

Conclusion and Investment Recommendation

Given the steady financial growth, fair valuation, and lack of grey market premium, the Swastika Castal IPO presents a moderate investment opportunity but lacks strong listing gains. The company’s focus on quality manufacturing and expansion is positive; however, the zero GMP suggests limited upside on listing day.

Investors looking for quick listing gains may prefer to avoid this IPO, while those seeking a long-term investment in a niche aluminium casting player may consider subscribing after due diligence.

Disclaimer: This content is for educational and informational purposes only and does not constitute financial advice. Investors should consult professional advisors before investing. Securities investment involves market risks, and past performance is no guarantee of future returns.

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