New Delhi, August 29(HS): ARC Insulation and Insulators, a manufacturer of high-performance glass fiber reinforced polymer composite products, made a robust entry into the stock market today. The company’s shares debuted strongly on NSE’s SME platform at ₹145, reflecting a 16% premium over the IPO issue price of ₹125. However, the initial rally was short-lived as selling pressure triggered a fall, pushing the stock down to its lower circuit level of ₹137.75 within hours. This price movement reduced IPO investors’ first-day gains to 10.20%.

The company’s IPO, worth ₹41.19 crore, was open for subscription from August 21 to 25 and received an overwhelming response, being oversubscribed 18.71 times overall. Qualified Institutional Buyers (QIBs) reserved portion was subscribed 15.12 times, Non-Institutional Investors (NIIs) portion 24.84 times, and Retail Investors portion 17.27 times. The issue comprised issuance of fresh shares worth ₹38.06 crore and an Offer for Sale (OFS) of 2.5 lakh shares with a face value of ₹10 each.

Funds raised through the IPO will be deployed to set up factory sheds at a new manufacturing unit, acquire office space, reduce existing debt burden, meet working capital requirements, and for general corporate purposes.

Financially, the company has shown steady growth as per its prospectus. Net profits surged from ₹2.64 crore in FY 2022-23 to ₹6.10 crore in FY 2023-24 and further to ₹8.57 crore in FY 2024-25. Revenue grew at a compound annual growth rate (CAGR) of over 16%, reaching ₹33.15 crore. The company’s debt fluctuated over the years, declining from ₹5.30 crore in FY 2022-23 to ₹2.78 crore in FY 2023-24 before rising again to ₹5.97 crore by FY 2024-25.

This volatile debut highlights both investor enthusiasm and caution amid profit-booking pressures for the new entrant ARC Insulation on the stock market stage.

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Hindusthan Samachar / Jun Sarkar