Venus Pipes IPO: Gujarat-based Venus Pipes & Tubes Ltd. The manufacturer of seamless tubes/pipes and welded tubes/pipes aims to mop up Rs 165.42 crore through this offer at the upper end of the price band of Rs 310-326 per share. The Rs 165.41 crore Venus Pipes IPO will be available for subscription till Friday, May 13, 2022. The IPO of Venus pipes and tubes company is entirely a fresh issue comprising a sale of 50.74 lakh (50,74,100) equity shares and there is no offer-for-sale (OFS) portion. The entire proceeds from the issue will be used for financing the project cost towards capacity expansion and backward integration for manufacturing of hollow pipes, meet working capital requirements and for general corporate purposes, according to the details given in the red herring prospectus (RHP).
Venus Pipes IPO: Subscription Status
Venus Pipes and Tubes IPO had been subscribed 2.83 times by the morning of May 12, Day 2 of the bidding, with investors sending in bids for more than 1 crore shares against an IPO size of 35.51 lakh shares. Retail investors have bid 4.95 times of the shares set aside for them, while non-institutional investors’ portion has been subscribed 1.16 times. Qualified institutional buyers have subscribed 36 percent of their quota of 10.14 lakh shares. Venus Pipes has reserved half of the total offer for qualified institutional buyers, 15 percent for non-institutional investors and the remaining 35 percent for retail investors.
Venus Pipes IPO: Lot Size
Investors who wish to subscribe to Venus Pipes IPO can bid in a lot of 46 equity shares and multiples thereafter. At the upper price band, they will be shelling out Rs 14,996 to get a single lot of Venus Pipes and Tubes. The shares will be listed on both BSE as well as the National Stock Exchange (NSE).
The applicants also must note that the cut-off time for UPI mandate confirmation is Tuesday, May 17, 2022, upto 12:00 pm. If they fail to do so then their application may not be considered.
Before heading into the IPO, Venus Pipes and Tubes on Tuesday raised over Rs 49 crore (Rs 49,62,32,636) from three anchor investors in lieu of 15,22,186 equity shares at Rs 326 each, data from the stock exchanges showed.
Venus Pipes IPO: GMP Today
As per IPO Watch, its GMP has been wavering between Rs 20 and 35 per equity share. Starting with a GMP of Rs 35 per share on May 6, the GMP took a dip on May 9 when it declined to Rs 20 per share. On May 10, the GMP again pushed northwards to reach its earlier high of Rs 35 but declined again on May 11 to touch Rs 25. Experts expect more fluctuations in this.
This indicates a positive listing for the stock and investors might earn some listing gains when the stock will make its debut on the bourses on May 24.
Venus Pipes IPO: Should You Invest?
Brokerages had a mixed opinion about the company with some recommending the stock for subscription, while some advising to avoid it.
The research team at Anand Rathi Share and Stock Brokers in its IPO note gave an “Avoid” recommendation to the offer.
Anand Rathi Research in its report noted, “The company is available at the upper end of the IPO price band at 21x its FY22 annualized earnings attributable to post issue equity demanding a market cap of Rs 6,617 million. At the upper end of the IPO price band, the issue is priced at a P/BV of 10.7x based on its NAV of Rs 30.5 as of March 31, 2021. The Company has delivered good growth in Sales over past few years along with increasing margin profile. However, Venus faces competition from its peers who hold substantial market share in the SS pipes and tubes market. When compared to its listed peers, Venus seems to be richly priced. We recommend an “Avoid” rating to this IPO.”
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