Scoda Tubes IPO Gains Momentum with 5x Subscription on Day 2

Scoda Tubes IPO received a strong response from investors, with a subscription of 5.19x by the 1st half of Day 2. The company is offering shares at a price band of Rs 130 to Rs 140 per share, with a minimum lot size of 100 shares. The Rs 220 crore IPO consists of a wholly fresh issue. Stay tuned for the latest updates on Scoda Tubes IPO subscription status as the offering progresses.

Scoda Tubes IPO Subscription Status - Day 2

By mid-day on Day 2, the Scoda Tubes IPO was subscribed 5.19 times overall. The retail category saw 4.71 times subscription, while Non-Institutional Investors (NIIs) subscribed 10.56 times, and Qualified Institutional Buyers (QIBs) 1.98 times.

Last updated: 01:30 PM, Thursday, 29 May 2025

Scoda Tubes IPO Subscription Status - Day 1

By the middle of Day 1, the Scoda Tubes IPO had an overall subscription of 1.90x. The retail category was subscribed at 1.97x, while Non-Institutional Investors (NIIs) subscribed at 2.28x, and Qualified Institutional Buyers (QIBs) subscribed at 1.50x.

Company Overview of Scoda Tubes IPO 

Scoda Tubes Limited is a seasoned Indian manufacturer of stainless-steel tubes and pipes, with over 14 years of industry experience. The company offers two primary product categories, seamless and welded tubes/pipes, across five main product lines: stainless steel seamless pipes, seamless tubes, “U” tubes, instrumentation tubes, and welded tubes, including welded “U” tubes. 

The company operates a hot piercing mill to produce mother hollow tubes, and also offers job work services like annealing, straightening, pickling, and marking. Raw materials, including stainless steel round bars and coils, are sourced from domestic suppliers based on cost, quality, and availability. Its sole manufacturing unit, located on the Ahmedabad-Mehsana Highway, provides strategic logistical benefits and includes storage for both raw materials and finished goods.

These products cater to a wide range of sectors, including oil and gas, chemicals, fertilizers, power, pharmaceuticals, automotive, railways, and transportation. The company serves both domestic stockists and industrial clients, as well as exports to countries such as the United States, Italy, Germany, Austria, and several Eastern European nations.

Strengths of Scoda Tubes IPO

• Exclusive Stainless Steel Expertise:
  Scoda Tubes focuses solely on stainless steel seamless and welded tubes and pipes, allowing the company to develop specialized knowledge in manufacturing and customization. This sharp focus enables them to deliver precise solutions tailored to specific requirements in dimensions, thickness, and material grade.

• Impressive Financial Performance:
  The company has demonstrated strong financial momentum, with revenue rising from Rs 194.03 crore in FY22 to Rs 399.86 crore in FY24, achieving a CAGR of 27.26%. Net profit also surged from Rs 1.64 crore to Rs 18.3 crore during the same period, reflecting high operational efficiency and sustained market demand.

• International Quality Certifications:
  Scoda Tubes holds major global certifications such as ISO, PED, AD 2000, IBR, and DNV. These accreditations affirm the company’s ability to meet stringent international standards, supporting its presence across varied industries and export destinations.

• Wide Industry Reach:
  With a diverse customer portfolio across domestic and overseas markets, the company supplies to sectors including oil & gas, power, chemicals, and transportation. Dedicated stockists in India and the U.S. further enhance its distribution and market penetration.

• Integrated and Strategically Located Operations:
  Scoda Tubes’ manufacturing facility, strategically positioned near major export routes, supports streamlined logistics. The in-house hot piercing mill provides backward integration, enhancing production flexibility and reducing costs to better meet dynamic client needs.

Risks of Scoda Tubes IPO 

• Dependence on Key Clients:
  A large share of Scoda Tubes’ revenue is generated from its top 10 customers, with the highest contributor accounting for 18.5%. The absence of long-term agreements exposes the company to revenue unpredictability and potential financial instability if key customers reduce or cease orders.

• Capacity Expansion Uncertainty:
  The company plans to expand its welded pipe production capacity, despite the current underutilization of its existing 1,020 MTPA facility. This raises concerns about the efficiency and financial returns of the capital expenditure, as it may not translate into proportional growth in revenue.

• Working Capital Intensity:
  Extended production timelines and longer credit terms to customers compared to those from suppliers result in a stretched cash conversion cycle. This scenario places a strain on liquidity and increases reliance on working capital to sustain operations.

• Operational Concentration Risk:
  Scoda Tubes' manufacturing operations are centralized at a single facility in Mehsana, Gujarat. Any operational disruptions, from equipment failure to natural disasters or local disturbances, pose a significant threat to uninterrupted production and overall business continuity.

• Foreign Exchange Exposure:
  With approximately 20–30% of revenue derived from exports, mainly in USD and Euro, the company is vulnerable to currency fluctuations. Adverse exchange rate movements can impact profitability and distort financial performance when revenues are converted to Indian Rupees.

• Market Volatility Challenges:
  The stainless steel tubes and pipes industry is subject to demand fluctuations and raw material price swings. Broader economic trends and sectoral cycles further contribute to volatility, potentially affecting both pricing power and earnings stability.

Scoda Tubes IPO Financial Overview

The financial performance of Scoda Tubes over FY22 to FY24 shows strong and consistent growth backed by improved operational efficiency. Revenue from operations rose steadily from Rs 194.03 crore in FY22 to Rs 305.03 crore in FY23 and Rs 399.86 crore in FY24, reflecting robust year-on-year growth of 57.2% and 31.1%.

Profitability also strengthened significantly. EBITDA surged from Rs 9.99 crore in FY2022 to Rs 58.79 crore in FY24, with margins improving from 5.15% to 14.70%, highlighting better scale and cost management. PAT increased from Rs 1.64 crore to Rs 18.30 crore over the same period, while PAT margins rose from 0.84% to 4.58%, indicating stronger bottom-line performance.

Key return metrics reflect enhanced capital efficiency. RoE climbed from 4.68% in FY22 to 28.77% in FY24, and RoCE improved from 5.84% to 15.92%, showcasing effective utilization of both equity and capital in driving growth and profitability.

Scoda Tubes IPO Details

• IPO Open Date: May 28, 2025 

• IPO Close Date: May 30, 2025

• Issue Price: Rs 130 to Rs 140 per share

• Lot Size: 100 shares

• Total Issue Size: 1,57,14,286 shares (amounting to Rs. 220 Cr)

• Fresh Issue: 1,57,14,286 shares (amounting to Rs. 220 Cr)

• Allotment Date: June 2, 2025

• Listing Date: June 4, 2025
  

How to Apply for Scoda Tubes IPO

• Visit the Rupeezy app.

• Navigate to the IPO section on the Home Page

• Here, you can view all the IPOs with details such as market lot, minimum bid quantity, price range, and analysis.

• You can read the Red Herring Prospectus for the issue details.

• Click on Apply.

• Enter your UPI ID for payment & place the bid.

• While placing the bid, enter the cutoff price or desired price in the range specified. Select quantity as per the lot size. 

• Submit to complete the order.