Ardee Industries IPO gets thumbs up from brokerages; grey market trend firm
Ardee Industries IPO: Reasonable valuations, strong fundamentals, and growth prospects make analysts bullish on the public offer.
 "Ardee Industries IPO gets thumbs up from brokerages; grey market trend firm")
Ardee Industries IPO: Ardee Industries, a leading player in the circular economy, specialising in the recovery and recycling of lead, is set to launch its ₹426-crore initial public offering (IPO) on Wednesday, August 5. The offer has already garnered positive views from most brokerages amid a strong trend in the grey market.
Reasonable valuations, strong fundamentals and growth prospects make analysts bullish on the IPO.
Meanwhile, the grey market premium (GMP), well-tracked by retail investors, stands at ₹7.5 currently. Though it has moderated from ₹13 a few days back, the current GMP for Ardee Industries IPO signals an estimated listing price of ₹60.5, an upside of 14.15 per cent from the upper end of the price band.
Ardee Industries IPO: Key details
Ardee Industries IPO is available for bidding till August 7, with the anchor book slated to open later tonight (August 4).
The book-building issue is a mix of fresh share sale of ₹320 crore and offer for sale of ₹106 crore. The price band for Ardee Industries IPO is set at ₹50-53 per share. Investors can apply for the IPO in lots of 281 shares.
The company plans to use the fresh proceeds for funding working capital needs, repayment of certain borrowings and general corporate purposes.
Brokerages on Ardee Industries IPO
Here's what top brokerages recommended on the offer:
SBI Securities: Subscribe for long term
SBI Securities said that Ardee is engaged in the business of lead recycling with product offerings comprising of pure lead and various lead alloys that find applications in critical industries. Over the recent years, the company has expanded its installed lead recycling capacity from 54,750 MTPA in FY24 to 1,04,025 MTPA in FY26.
Additionally, the company recently augmented its total capacity to 1,56,950 MTPA, which shall also ramp-up in FY27, leading to robust volume growth. Going ahead, Ardee plans to enter into new verticals which shall be facilitated through its recently acquired 5.56 acre land parcel, leading to reduced dependency on single revenue stream.
At the upper price band of Rs 53, the issue is valued at P/E multiple of 19.7x based on post-issue capital. Therefore, it recommended investors to 'subscribe to the issue for long-term'.
Swastika: Apply for listing & long-term gains
Swastika Investmart said that the offer is priced at 15.96x P/E, offering nearly a 50 per cent discount compared to listed recycling peers trading at 32x–35x P/E. The company reported an exceptional RoNW of 57.46 per cent, significantly higher than peers such as Gravita (15.43 per cent) and Pondy Oxides (16.73 per cent).
Fresh issue proceeds will expand net worth and reduce debt, pulling the Debt-to-Equity ratio down further to ~0.35x, it added, thus making Ardee IPO suitable for investors seeking both listing gains and long-term value.
Choice Broking: Subscribe for long term
At the upper price band, Ardee Industries is valued at a P/E of 19.7x based on FY26 earnings and an EV/Sales of 1.3x, which appears reasonably priced relative to its established position in India's recycled lead industry, said Choice Broking.
While the business remains exposed to lead price volatility, environmental regulations, and
working capital intensity, its board-approved hedging framework and established sourcing network help mitigate these risks, it said.
"Considering its reasonable valuation, integrated business model, and long-term growth prospects driven by the expanding circular economy, we recommend a 'Subscribe for Long-Term' rating for the issue," it added.
About the company
Ardee Industries recycles used lead batteries and lead scrap into high-purity lead and lead alloys, and supplies these materials mainly customers in India and abroad, mainly operating across industries such as energy storage, e-mobility, automotive, and chemicals.
The company operates a manufacturing facilities located in the Tirupati district of Andhra Pradesh, with an aggregate installed recycling capacity of 156,950 MTPA.
Historically, the company has recorded revenue/Ebitaa/PAT CAGR of 58.8 per cent/129 per cent/207.5 per cent respectively over the FY24-FY26 period, suggesting strong financial positioning.
Pantomath Capital Advisors is the book running lead manager and Kfin Technologies Ltd. is the registrar of the issue. Shares of the company will list on BSE and NSE on August 12.
Disclaimer: Views and outlook shared belong to the respective brokerages/analysts and are not endorsed by Business Standard. Readers' discretion is advised.