Scoda Tubes IPO: Issue booked over 23x day 3 so far; check latest GMP

The initial public offering (IPO) of Scoda Tubes saw a strong demand from investors during the third and final day of the bidding process across all categories of investors. The issue was booked nearly 2.25 times on day one and ended day two with nearly 9 times subscription. 

Scoda Tubes is selling its shares in the price band of Rs 130-140 apiece. Investors can apply for a minimum of 100 shares and its multiples thereafter. It is looking to raise Rs 220 crore via IPO, which is entirely a fresh share sale of up to 1,57,14,286 equity shares.

According to the data, the investors made bids for 27,87,63,100 equity shares, or 23.53 times, compared to the 1,18,46,169 equity shares offered for the subscription by 1.40 pm on Friday, May 30, 2025. The issue, which kicked off on Wednesday, May 28, shall close for bidding today.

The allocation for non-institutional investors (NIIs) was subscribed 67.90 times, while the portion reserved for retail investors saw a subscription of 13.14 times. However, the quota set aside for qualified institutional bidders (QIBs) was booked 8.45 times as of the same time.

Scoda Tubes, based in Ahmedabad, has been manufacturing stainless-steel tubes and pipes since its incorporation in 2008. The company specialises in seamless and welded tubes, marketed under the brand name 'Scoda Tube'. Its manufacturing facility is strategically located on the Ahmedabad-Mehsana highway in Rajpur.

Recently, the grey market premium (GMP) for Scoda Tubes has faced a downturn amidst broader market volatility. Currently, the company commands a premium of Rs 18 per share in the unofficial market, suggesting a 13% listing gain for investors. This is a drop from the previous Rs 22 per share.

Scoda Tubes caters to a broad spectrum of industries, including power, pharmaceuticals and oil & gas, serving both domestic and international markets. It offers job work services and holds quality certifications and approvals from major PSUs and private clients. Although ongoing global market volatility remains a key risk factor, its one-third of revenue comes from exports, said Sachin Jasuja, Founding Partner and Head Equities at Centricity.

"From a financial standpoint, the company maintains decent metric. Scoda Tubes' growth has moderated in the last 9 months, and an earnings CAGR above 20 per cent seems unlikely. Having said this, the current valuations appear fair. Though near-term upside may be capped without stronger demand visibility, overall, Scoda presents a stable but moderately growing business," he said.

Scoda Tubes successfully raised Rs 66 crore by allocating 47.14 lakh equity shares at Rs 140 each to six anchor investors. For the nine months ending December 31, 2024, the company reported a net profit of Rs 24.91 crore and revenue of Rs 363.48 crore. Comparatively, for the fiscal year ending March 31, 2024, it recorded a net profit of Rs 19.30 crore with a revenue of Rs 402.49 crore.

In its initial public offering (IPO), Scoda Tubes has reserved 50% of shares for qualified institutional bidders, 15% for non-institutional investors, and 35% for retail investors. The market capitalisation is expected to close in on Rs 840 crore.

With the planned increase in capacity across both the segments, Scoda Tubes is well-positioned to benefit from the further scaling up of its operations, led by utilization of its backward integrated. The rising demand for stainless steel pipes and tubes, its strong export footprint, with established relationships in the US and Europe, provides revenue visibility, said KR Choksey Finserv.

"Scoda Tubes’ initial issue is priced at 16.4 times TTM EV/Ebitda, which is 20 per cent discount to the peer’s average. Scoda Tubes appears attractively priced compared to peers, and thus we assign a 'subscribe' rating for listing gains. It is recommended to review the position for long-term holding," it said.

Monarch Networth Capital is serving as the sole book-running lead manager for the IPO, and MUFG Intime India is the registrar. The allotment basis is set to be finalised by June 2. The shares of Scoda Tubes are anticipated to list on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The tentative date for listing is June 4, offering potential growth opportunities for investors.