Oswal Pumps Ltd. saw its share price tumble nearly 8% intraday on June 23, plunging to ₹580 on the BSE—well below its IPO price of ₹614. This drop marked an 11% decline from the stock’s listing-day high of ₹649.15. By midday, the price had rebounded to approximately ₹626–₹627, tracking broader market shifts.
What Triggered the Sharp Correction?
- Post-IPO Profit-Taking: After a modest listing premium of 3–7%, early investors booked gains, triggering a sharp retreat.
- Muted Listing Sentiment: Despite strong subscription (34x overall), listing enthusiasm didn’t fully match grey-market expectations .
- Broader Market Pressure: Sensex and Nifty declined ~1% during the session, further weighing on newly listed and small-cap stocks.
IPO in Review
- Issue Size: ₹1,387 crore (fresh issue + OFS).
- Issue Price: ₹584–₹614; opened at ₹634 on NSE and ₹632 on BSE, marking a 3% premium.
- Listing Day High: ₹649.15 (amid grey market signals of 6–7% expected premium).
Strong Operational Performance Post-Listing
Despite the dip:
- Oswal Pumps stock recovered to ~₹627 by midday, showing a moderate decline and outperforming several session peers.
- Brokerage firm Mehta Equities recommended investors hold for the long term, citing the company’s strong fundamentals, especially its exposure to rural electrification and solar-driven infrastructure growth.
Business Overview & Growth Prospects
- Founded: 2003, Karnal-based pump manufacturer focusing on agricultural, industrial, and solar pumps.
- Financials (FY24 & 9MFY25):
- FY24 Revenue: ₹758.6 crore; Net Profit: ₹97.7 crore
- 9M FY25 Revenue: ₹1,065.7 crore; Net Profit: ₹216.7 crore — doubling profitability.
- PM-KUSUM Projects: Completed ~26,270 solar pumps under the scheme.
- Exports: Sales to 17–22 countries, supported by strong rural and solar infrastructure initiatives.
IPO Fund Utilization
- Capex: ~₹90 crore for facility expansion
- Investment in Oswal Solar: ₹273 crore
- Debt Repayment: ₹280 crore (with ₹31 crore allocated for subsidiary).
This capital allocation strengthens operational capacity and reduces debt burden .
Should You Hold or Exit?
Reasons to Hold:
- Long-Term Structural Tailwinds: Key beneficiary of rural electrification and solar irrigation schemes.
- Strong Financial Performance: Rapid growth in revenue and profits, with improving margins.
- Reduced Debt & Capex: IPO proceeds strengthen balance sheet & expansion plans .
Short-Term Risks:
- Profit-taking post-listing remains likely after early gains.
- Market volatility could continue, especially in small-cap stocks.
As Mehta Equities notes, investors could accumulate on dips near ₹600–620, especially with long-term sector drivers intact.
Quick Recap
| Metrics | Details |
|---|---|
| IPO Price | ₹614 |
| Listing Premium | 3.0–7.0% |
| Intraday Low on June 23 | ₹580 (~8% drop) |
| Recovered Price | ~₹626–627 |
| 9MFY25 Revenue/Net Profit | ₹1,065.7 cr / ₹216.7 cr |
| Debt Reduction via IPO | ₹280 cr |
| GMP (Grey Market Premium) | Forecast 6–7% (~₹41) listing gain |
| Analyst View | Hold / accumulate on dips |
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should perform due diligence or consult a certified financial advisor before making investment decisions.
Also Read: Kalpataru IPO Opens June 24; 2% Grey Market Premium Signals Cautious Optimism
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