May 31, 2024
New Delhi, India
GSM Foils Makes Muted Debut, Lists at IPO Price on NSE SME
GSM Foils, a company specializing in pharmaceutical packaging, made a subdued debut on the NSE SME today, listing at its IPO price of ₹32 per share. Despite the initial tepid opening, the share price managed to rise over 3% during the trading session.
IPO Subscription and Listing
The GSM Foils IPO, which opened for subscription on May 24 and closed on May 28, saw an overwhelming response, with the issue being subscribed 257.30 times. The retail portion was subscribed 247.10 times, while the non-institutional investor (NII) portion was booked 259.51 times. The strong demand reflected investors’ confidence in the company’s prospects.
Business Overview
GSM Foils specializes in the production of Blister Foils and Aluminium Pharma Foils, commonly known as “Strip Foils,” used in the packaging of pharmaceutical tablets and capsules. Ensuring the quality of these foils is crucial, as they come into direct contact with medications. The company has developed significant expertise in this niche market, catering to the stringent requirements of the pharmaceutical industry.
Financial Performance
Between March 31, 2022, and March 31, 2023, GSM Foils reported a 124.62% increase in profit after tax (PAT), despite a sales decline of 8.3%. This growth in profitability highlights the company’s ability to manage costs and improve margins even when sales are under pressure.
IPO Details
The IPO consisted of a fresh issue of 3,440,000 equity shares, each with a face value of ₹10, raising approximately ₹11.01 crore. The proceeds are intended for general corporate purposes, working capital requirements, and capital expenditures for purchasing plant and machinery.
Promoters and Comparisons
The company’s promoters are Mohansingh L. Parmar and Sagar Girish Bhanushali. Listed peers include MMP Industries Ltd and Synthiko Industries Ltd, which also operate in the pharmaceutical packaging sector.
Conclusion
GSM Foils’ entry into the public market was marked by a muted debut at its IPO price, followed by a modest increase. The strong subscription rates, particularly from retail investors, demonstrate confidence in the company’s growth potential. With its focus on high-quality pharmaceutical packaging and plans for strategic investments, GSM Foils is poised to strengthen its position in the industry.
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