Bumper listing: Stock of this SME debutant doubles against its issue price

Shares of Kalyani Cast-Tech locked in upper circuit at Rs 277.30, zooming nearly 100% from its issue price of Rs 139 on the BSE.

Kalyani Cast-Tech made a stellar stock market debut on Friday with its share price doubling to Rs 277.30 against its issue price of Rs 139 per share on the BSE.

The stock, which got listed at Rs 264.10, extended gains and was locked in the 5 per cent upper circuit. The shares got listed on BSE SME platform.

Till 10:28 AM; total 829,000 equity shares changed hands and there were pending buy orders for 1,000 shares on the BSE, the exchange data showed.

The initial public offering (IPO) of the cargo containers manufacturer Kalyani Cast-Tech had received a robust response from investors with a total subscription of 208.59 times.

The public issue was subscribed 190.95 times in the retail category, 66.35 times in the qualified institutional buyers (QIB) category, and 439.20 times in the non-institutional investor (NII) category.

The minimum lot size for an application was 1,000 shares. The minimum amount of investment required by retail investors was Rs 139,000. The minimum lot size investment for HNI was 2 lots (2,000 shares) amounting to Rs 278,000.

The company has a class A foundry and manufactures products such as MG coupler components, CI brake blocks, adapter for WDG4 loco, bearing housing for electrical loco, corner casting for containers motor hub traction motors etc.

The company caters to a diverse client base such as the Indian railways, companies engaged in the mining, cement, chemicals, fertilizers and power industry.

The company, while catering to railways, saw an opportunity in the year 2018 and started an addition line of business of manufacturing containers. These containers were used by the railway transporters to transport goods via the rail network in India.

Indian Railway network is growing at a healthy rate. In the next five years, Indian railway market is expected to be the third largest, accounting for 10 per cent of the global market.

The government has announced two key initiatives for seeking private investments-running passenger trains by private operators across the railways network and redevelopment of railway stations across the country.

According to Indian Railways, these projects have the potential of bringing an investment of over $7.5 billion in the next five years, the company said in its Red Herring Prospectus.

The India foundry market size is estimated to grow at a CAGR of 10.77 per cent between 2022 and 2027. The market size is forecast to increase by $15,684.57 million. The growth of the market depends on several factors, including a focus on technology upgrades, make-in-India initiatives, and increasing confidence within the foundry industry, it said.