Prince Pipes Shares Fall 6.4% Below IPO Price On Listing Day

Prince Pipes & Fittings Ltd. was able to recover early losses in trade but closed lower than its issue price on its stock market debut.

The stock ended trade 6.4 percent lower at Rs 166 per share on the Bombay Stock Exchange, compared to its issue price of Rs 178 apiece. Earlier in the day, the stock fell as much as 14.3 percent to Rs 152.50.

The initial public offer of Prince Pipes and Fittings was subscribed 2.21 times on the last day of bidding. The Rs 500-crore offer received bids for 4.37 crore shares against the total offer size of 1.97 crore shares, as per stock exchange data.

The IPO values the company at nearly Rs 1,958 crore at the upper-end of the price band, according to BloombergQuint’s calculations. After the offer, the promoter shareholding will fall to 65.8 percent from 90.06 percent. The rest will be held by public shareholders.

Prince Pipes, according to its red herring prospectus, is the country’s sixth largest pipemaker by market share.

The company’s net sales and profit after tax grew at an annualised rate of 13 percent and 41 percent, respectively, over the last four financial years, according to the red herring prospectus.

Parag Chheda, executive director of the pipemaker, expects the growth trend to continue. “Based on the growth drivers which is the substitution market, be it for agriculture, the hundred smart cities, housing for all, we see that growth will continue to the levels of 12-14 percent year-on-year,” he told BloombergQuint.