Vruddhi Engineering Works shares rally over 6% after a weak debut on BSE SME platform
Upstox
2 min read • Updated: April 3, 2024, 1:55 PM
Summary
After listing at 1.42% premium to IPO price, Vruddhi Engineering Works stock gained some momentum on buying interest among investors and rose to ₹74.55 per share, reflecting gains of 6.5% from the issue price and 5% from the listing price.
Vruddhi Engineering Works made a tepid debut on stock exchanges on Wednesday, April 3, as its shares were listed at a premium of 1.42%.
Shares of Vruddhi Engineering Works opened the trade on the BSE SME platform at ₹71 apiece against the issue price of ₹70 per share. The stock later gained some momentum on buying interest among investors and rose to ₹74.55 per share, reflecting gains of 6.5% from the issue price and 5% from the listing price.
Nearly 3 lakh shares of the company changed hands in the first 15 minutes of trade. The turnover was ₹2.14 crore while the market capitalisation of the company stood at ₹18.81 crore.
Vruddhi Engineering Works is a mechanical splicing solutions provider for the construction industry. Its rebar couplers are widely used in residential commercial and infrastructure projects.
What will the company do with IPO proceeds?
Vruddhi Engineering Works has proposed to utilise the IPO proceeds for financing its working capital requirements. It will use ₹2.60 crore to fund working capital needs.
The company meets its working capital needs in the ordinary course of business from internal accruals and borrowings. To support the incremental business requirements, the company requires additional working capital, it had stated in the RHP. It will lead to a consequent increase in profitability and achieving the proposed targets as per its business plan.
Vruddhi Engineering Works hit the capital market on March 26 to raise around ₹4.76 crore through its IPO. The issue closed on March 28, 2024, with a 12.67 times subscription level. The book built issue of 7.21 lakh shares was priced at ₹66-70 per share.
About Vruddhi Engineering Works
The Mumbai-based company is mainly engaged in offering mechanical splicing solutions to the real estate, construction and infrastructure industry by designing, engineering and supplying rebar couplers.
The company also provides on-site threading services of the couplers and also trades in threading machines and spares. Its revenue from sale of rebar couplers is ₹2.69 crore for the period ended September 30, 2023 and ₹4.50 crore in FY23.
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