Mainboard IPOs Overview
The IPO excitement continues unabated, with a variety of mainboard IPOs from various industries hitting D-Street each month, similar to the domestic benchmark indices, which are consistently setting new records. Two distinct mainboard IPOs have emerged in the first week of July, and they are set to close today. Both IPOs were fully subscribed on the first day of bidding due to strong interest from retail and non-institutional investors.
Bansal Wire Industries IPO Details
Regarding the IPOs, Bansal Wire Industries is offering new equity shares worth ₹745 crore, without an offer-for-sale (OFS) component. The price range for each share is ₹243–256. The funds will be used for normal business operations, debt repayment, and meeting the company’s working capital needs. Bansal Wire Industries produces and exports steel wire, focusing on three main categories: stainless steel wire, mild steel wire (low carbon steel wire), and high carbon steel wire. The Bansal Wire Industries IPO subscription status was 5.73 times on the second day of bidding.
Emcure Pharmaceuticals IPO Details
In contrast, the Emcure Pharmaceuticals IPO includes a new issue of equity shares worth ₹800 crore and an OFS by promoters and existing shareholders for 1.14 crore equity shares, valued at ₹1,152 crore at the top end of the price range. This brings the total public issue to ₹1,952 crore. The OFS includes shares sold by investor and promoter Satish Mehta and BC Investments IV Ltd., a part of US-based private equity giant Bain Capital. The proceeds from the new issuance will be used for debt repayment and normal business activities. The issue’s price band is set between ₹960 and ₹1,008 per share. The Emcure Pharma IPO subscription status was 4.98 times on the second day of bidding.
Expert Opinions
Arun Kejriwal, Founder of Kejriwal Research and Investment Services
Kejriwal noted that one IPO is smaller while the other is three times larger. From an allotment perspective, the chances of getting shares in the larger IPO are better. Therefore, if you want an allotment, the pharma company is a better bet. Regarding prospects, pharma is a proven and defensive business. Bansal Wire Industries is expanding, which will drive growth, but the benefits of this expansion will take 6–8 months to materialize. While both IPOs offer listing benefits, holding Bansal Wire Industries post-listing could yield more money after the initial excitement subsides. One could re-enter Bansal Wire Industries later and profit by holding it for a year.
“Pharma is straightforward. Compare it with its peer group and decide what to do. The biggest advantage for Emcure Pharma is its size, almost ₹2,000 crore, providing a better chance of allotment at this time,” Kejriwal explained.
Prashanth Tapse, Research Analyst, Senior Vice President of Research at Mehta Equities
Tapse believes that both IPOs are fairly priced and offer value for new investors, with listing gains expected from the IPO. The long-term growth potential is evident in both business models. Both companies are reducing debt with the IPO proceeds, lowering their financial burden, and improving their bottom line.