Prince Pipes and Fittings IPO: Shares of Prince Pipes and Fittings made a tepid listing on the exchanges BSE and NSE today. The company debuted at the price Rs 160 on BSE, a 10.11% discount to Rs 178, its issue price.
Prince Pipes and Fittings' stock price has risen 9.68% to the intraday high of Rs 175.50 on BSE. The day's high of Rs 175.50 is 1.4% at discount to the issue price of Rs 178. On the other hand, the stock has made an intraday low of Rs 152.60, falling 4.6% against the listing price.
The IPO of Prince Pipes and Fittings comprised of fresh issue of Rs 250 crore and an equal amount through offer-for-sale (OFS). In pre-IPO placement, Prince Pipes issued 59,26,820 equity shares, representing 6.18 per cent stake for cash consideration of Rs 106.18 crore by South Asia Growth Fund LLP at Rs 178 per equity share. The initial public offer, which ran from December 18 to December 20, 2019 got subscribed 2.22 times on its last day of bidding for subscription. It Rs 500-crore IPO offer was subscribed 28% on the opening day and 41% on Thursday, its second day of subscription.
The Mumbai-based end-to-end polymer piping systems' solution provider, Prince Pipes has over 30 years of experience in the polymer pipes and fittings manufacturing segments and holds 5% Indian market share manufacturing of both polymer pipes and fittings. The firm owns 6 manufacturing facilities strategically located across India, with an installed capacity of 241,211 tonnes.
Santosh Meena, senior analyst at TradingBells said, "On expected lines, Prince Pipes made its secondary market debut at a 10% discount to its issue price. The stock looks attractive by its valuation but there is a question mark on its corporate governance. There are concerns regarding related party transactions and pledging of promoters shares. Investors are advised to avoid this stock and look for other quality stocks in the same space."
The products of the company are used in plumbing, irrigation, soil and rainwater harvesting. The polymer fittings company markets its products under Prince Piping Systems and Trubore. Now, the company is expanding its manufacturing facilities with two new units, one at Jobner near Jaipur in Rajasthan and the second one in Sangareddy (Telangana).
The Earning per share (EPS) of the company is valued at 9.26, which is lower when compared to its listed peers Astral Poly Technic, Finolex and Supreme. In terms of valuation, at the upper end of the price band, it is coming with trailing PE of 19, which is fairly priced compared to the competitors.
Jayant Shamji Chheda, Tarla Jayant Chheda, Parag Jayant Chheda, Vipul Jayant Chheda and Heena Parag Chheda are the promoters of the company. While Jayant Shamji Chheda is the Chairman and Managing Director of the company, Parag Jayant Chheda and Vipul Jayant Chheda are the executive directors.