Chamunda Electricals shares hit 5% lower circuit after listing at 40% premium over IPO price

Chamunda Electricals Ltd made a stellar debut on Tuesday, February 11, with its shares listing at a 40% premium over the issue price on the NSE SME platform.

Shares of the company started trading at ₹70 apiece on the NSE Emerge platform, compared to the issue price of ₹50 per piece, reflecting a gain of 40%.

Soon after listing, the stock dropped as much as 5% to hit the lower circuit limit of ₹66.5 apiece amid profit booking.

As many as 11.31 lakh shares changed hands on the NSE within minutes of listing. The total trading value stood at ₹7.9 crore. The company’s market capitalisation reached ₹73.18 crore.

At the listing price of ₹70 per share, the value of a single lot of equity shares bagged by IPO investors stood at ₹2,10,000 (₹70 x 3,000). The IPO investors would have made a profit of ₹69,000 per lot size as the minimum investment in a single lot was ₹1,41,000 (₹50 x 3,000).

Chamunda Electricals IPO details

Chamunda Electricals Ltd garnered ₹14.6 crore through its initial public offering (IPO), which was open for subscription on the NSE SME platform from February 4 to February 6. The public offer comprised entirely a fresh issue of 29.19 lakh shares. The IPO price band was fixed at ₹47 to ₹50 per share.

The NSE SME issue closed with a robust subscription of 738 times on February 6. The IPO received applications for 142.4 crore shares against 19.32 shares on offer.

Retail investors’ quota was subscribed 554 times as applications for more than 63 crore shares were received against 9.66 lakh shares on offer. The Non-Institutional Investors (NIIs) placed applications for more than 80 crore shares compared to 4.14 lakh shares on offer. The NIIs portion was overbooked 1,943 times. The Qualified Institutional Buyers (QIBs) placed bids for more than 8.6 crore shares against 5.52 lakh shares on offer, leading to oversubscription of 155 times.

The company has proposed to use ₹5.5 crore to meet working capital requirements. A sum of ₹2.85 crore would be used to repay term loans and cash credit.

The company has proposed to use ₹1.20 crore of IPO funds for capital expenditure on the purchase of new testing kit and equipment. The company has eight testing kits for testing work of Electricals equipment but these are not sufficient to cater the testing requirements of GETCO and other clients, considering the current and future O&M Contract of GETCO.

Chamunda Electricals provides services for the operation, maintenance, testing and commissioning of electrical sub-stations. Operation and Maintenance (O&M) of electrical substations is crucial for ensuring the reliability, safety and efficiency of power transmission and distribution up to 66kV (Class). The company operated and maintained 130 such sub-stations in FY 2024-25 against 99 such stations in the last financial year.

The company has also set up a 1.5 MW capacity solar power generation park in Gujarat and has signed a 25-year power purchase agreement with Uttar Gujarat Vij Company Limited.

It also offers services related to Extra High Voltage class equipment’s erection. The company installs and commissions electrical equipment designed to operate at voltages typically up to 220 kV.