Malpani Pipes and Fittings Limited is set to open its initial public offering (IPO) from January 29 to January 31, 2025, aiming to raise approximately ₹25.92 crores. The IPO will consist of a fresh issue of equity shares priced between ₹85 and ₹90 each, with a face value of ₹10 per share. As a prominent manufacturer of high-quality plastic pipes, including HDPE, MDPE, and LLDPE pipes, Malpani caters to various sectors such as irrigation and infrastructure.
₹5
₹90
₹85.90
Expert Opinions
Market sentiment surrounding the Malpani Pipes IPO is largely positive, reflecting growing investor interest in the plastic manufacturing sector, particularly in water management solutions. Malpani Pipes has demonstrated strong company fundamentals, with revenue increasing from ₹82.57 crores in FY2023 to ₹141.16 crores in FY2024, alongside a net profit of ₹7.40 crores, showcasing effective operational management. However, potential risks include high debt levels, with a debt-to-equity ratio of 2.04, and competition from established players in the industry that could pressure margins.
The IPO valuation reflects a return on equity (ROE) of 71.52% and a price-to-earnings (P/E) ratio of approximately 9.07 to 9.61, indicating an attractive entry point for investors. From a long-term investment perspective, Malpani Pipes is well-positioned to benefit from increasing demand for plastic pipes in various sectors.
Investor Considerations
Investors considering the Malpani Pipes IPO should analyze several key factors. Company performance and fundamentals highlight consistent growth, with revenue increasing from ₹82.57 crores in FY2023 to ₹141.16 crores in FY2024, alongside a rise in profit after tax (PAT) from ₹5.09 crores to ₹7.40 crores, demonstrating operational efficiency and financial stability. The sector outlook is promising, driven by increasing demand for plastic piping solutions in agriculture and infrastructure, supported by government initiatives.
The IPO valuation indicates a return on net worth (RoNW) of 50.07% and a PAT margin of 5.25%, suggesting a solid financial position. Growth prospects remain strong, with plans for expanding production capacity and enhancing product offerings. However, potential risk factors include competition from established players and fluctuations in raw material prices. A long-term investment horizon is advisable, as Malpani Pipes aims to capitalize on favorable trends in the plastic manufacturing sector for sustained growth and profitability.
FAQs
The Grey Market Premium showed poor accuracy in predicting Malpani Pipes and Fittings’ listing performance. While the GMP of ₹5 predicted a positive premium of 5.56% over the issue price, the stock actually listed at a discount of 4.56%. With a prediction error of 9.58%, the GMP not only failed to predict the magnitude but also misread the direction of the listing movement, demonstrating its unreliability as a price predictor in this case.
Malpani Pipes IPO Current GMP is ₹05.
Malpani Pipes IPO Expected Returns is 5.55%.
Malpani Pipes IPO estimated listing price is ₹95.