Aditya Ultra Steel makes decent debut, shares list at 12% premium to IPO price

TMT bars manufacturer Aditya Ultra Steel Ltd (AUSL) shares listed at a premium of 12% to the issue price on the NSE SME platform on Monday, September 16.

According to exchange data, shares of the company listed at ₹69.9 apiece, reflecting gains of 12% over the initial public offering (IPO) price of ₹62 per share.

However, Aditya Ultra Steel shares dropped 5% to hit the lower circuit at ₹66.40 after the listing due to selling by shareholders.

The stock hit a high of ₹72 per share and a low of ₹66.4 per share.

More than 6.8 lakh shares of the company changed hands on the bourse. The traded value stood at ₹4.72 crore. The market value stood at ₹ 164.91 crore, making investors’ richer by ₹10 crore despite a fall.

Aditya Ultra Steel Ltd, which sells products under the Kamdhenu brand, hit the capital market on September 9, 2024, to ₹45.88 crore through its initial public offer.

The issue comprised a fresh issue of 74 lakh shares. The company fixed the price band at ₹59 to ₹62 per share for the IPO. The minimum lot size was 2,000 shares and the minimum investment required was ₹1,24,000 for retail investors.

At close of bidding on September 11, Aditya Ultra Steel IPO was booked 10.76 times, driven by strong demand from retail investors.

Total bids for over 7.56 crore shares received against 70.3 lakh shares on offer.

The Non-Institutional Investors (NIIs) category was booked 12.52 times. Bids for 1.28 crore shares were received against 10.56 lakh shares on offer. The Retail Individual Investors’ category was booked 23.63 times. Bids for over 5.81 crore shares were received against 24.62 lakh shares on offer.

The Qualified Institutional Buyers (QIBs) quote was subscribed 1.2 times. Bids for 42.46 lakh shares were received against 35.12 lakh shares on offer.

Aditya Ultra Steel Ltd IPO objects

Founded in 2011, Aditya Ultra Steel Ltd is a manufacturer of rolled steel products such as TMT bars. The company has proposed to use IPO proceeds towards meeting capital expenditure, fund working capital requirements and for other general corporate purposes.

The company intends to utilise ₹15.35 crore towards capital expenditure for the commissioning of a solar power project of 5000 KWP which will meet a significant portion of its electricity requirements.

The solar power plant will enhance operational resilience by diversifying its energy sources and reducing exposure to volatility in electricity prices.

The company has proposed to utilise ₹15 crore of IPO proceeds to meet the working capital requirement and the rest for general corporate purposes.

The company reported revenue from operations of ₹587.8 crore in the 2023-24 financial year against ₹530.44 crore in the year-ago period. Profit after tax stood at ₹7.92 crore in the year ended March 2024 against ₹2.77 crore in the preceding financial year.