Newmalayalam Steel Shares Drop 5 Pc On Market Debut Despite Strong IPO Subscription
Date
12/27/2024 2:30:29 PM
(MENAFN- KNN India)
New Delhi, Dec 27 (KNN)
NewMalayalam Steel, a Kerala-based manufacturer of steel tubes and pipes, saw its shares decline 5 per cent from the issue price during its stock market debut on Friday.
The shares were trading at Rs 85.50 on the National stock exchange (NSE), down from the initial public offering (IPO) price of Rs 90.
While the stock opened flat at its IPO price, it subsequently hit the lower circuit limit, with approximately 4.11 lakh shares changing hands during the trading session.
The company's recent IPO, which concluded on December 23, had garnered significant investor interest with a subscription rate of 48.18 times.
The offering consisted of 46.40 lakh fresh equity shares, priced in a band of Rs 85-90 per share. Following the public issue, the promoter group's stake in the company has decreased to 73.02 per cent from the pre-IPO level of 99.80 per cent.
NewMalayalam Steel plans to utilise the IPO proceeds for various strategic initiatives, including technological upgradation of its manufacturing facility and expansion of its solar power generation capacity.
The funds will also support the construction of a new factory shed cum storage facility at its Kerala premises, along with advertising and marketing efforts to strengthen brand presence.
Additionally, the proceeds will help meet working capital requirements and general corporate purposes.
Founded in 2017, NewMalayalam Steel has established itself as a prominent player in the steel tubes and pipes sector.
The company operates an electric resistance welding tube mill in Kerala with an installed capacity of 3,500 MT, marketing its products under the Demac Steel brand.
With a workforce of 140 employees as of September 2024, the company reported revenue from operations of Rs 154.21 crore and a net profit of Rs 5.19 crore for the period ending September 30, 2024.
(KNN Bureau)
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