New Delhi, 24 February (HS): Royal Arc Electrodes, a company manufacturing welding electrodes, flex cord wire and welding consumables, disappointed its IPO investors by making a dull listing in the stock market on Monday. Under the IPO, the company had issued shares at a price of Rs 120. Today, its listing on the SME platform of the National Stock Exchange also took place at the level of Rs 120 without any fluctuation. However, due to the support of buying after listing, the price of this stock increased. After trading till 12 noon, the company's shares were trading at the level of Rs 121.05.

Royal Arc Electrodes' Rs 36 crore IPO was open for subscription between February 14 and 18. This IPO received an average response from investors, due to which it was subscribed 1.61 times overall. In this, the reserve portion for Qualified Institutional Buyers (QIB) was subscribed 1.04 times. Similarly, the reserve portion for non-institutional investors (NII) got 0.92 times subscription. Apart from this, the reserve portion for retail investors was subscribed 2.21 times.

Under this IPO, new shares worth Rs 21.60 crore have been issued. Apart from this, 12 lakh shares with a face value of Rs 10 have been sold under the Offer for Sale window. The company will use the money raised through the IPO to expand its manufacturing facility, meet working capital requirements and for general corporate purposes.

Talking about the financial position of the company, as per the claim made in the prospectus, its financial health has continuously strengthened. In the financial year 2021-22, the company had a net profit of Rs 2.12 crore, which increased to Rs 9.57 crore in the next financial year 2022-23 and Rs 11.93 crore in 2023-24. During this period, the company's revenue grew at a compounded rate of more than 24 percent annually to reach Rs 100.99 crore. During the first half of the current financial year i.e. between April to September 2024, the company has made a net profit of Rs 3.18 crore. Similarly, during this period the company has achieved a revenue of Rs 46.06 crore.

Hindusthan Samachar / Jun Sarkar