
The initial public offering (IPO) of Oswal Pumps has garnered considerable attention, securing successful subscription by the second day of bidding. Launched on Friday, June 13, the IPO was over 40% subscribed on its first day, driven primarily by non-institutional investors. The price band for the shares is set between Rs 584 and Rs 614 each.
According to the data, the investors made bids for 1,76,81,232 equity shares, or 1.09 times, compared to the 1,62,12,980 equity shares offered for the subscription by 2.20 pm on Monday, June 16, 2025. The three-day bidding for the issue close on Tuesday, June 17.
The allocation for non-institutional investors (NIIs) was subscribed 2.65 per cent, while the portion reserved for retail investors saw a subscription of 89 per cent. However, the quota set aside for qualified institutional bidders (QIBs) was booked only 24 per cent as of the same time.
Oswal Pumps aims to raise Rs 1,387.34 crore through this IPO, comprising a fresh issue of Rs 890 crore and an offer-for-sale (OFS) of up to 81,00,000 equity shares valued at Rs 497.34 crore. Investors can bid with a minimum of 24 shares and in multiples thereafter. The company has already attracted Rs 416 crore from anchor investors by allocating 67,78,533 shares at Rs 614 per share.
Founded in 2003, Oswal Pumps, based in Karnal, manufactures and distributes various types of pumps for domestic, agricultural, and industrial use. Their product offerings include solar pumps, submersible pumps, monoblock pumps, and electric panels, among others. Analysts are optimistic about the company's prospects due to the rising demand for solar pumps and its strong market position. However, the company faces risks such as delayed government funding and increasing working capital needs.
Oswal Pumps has delivered strong revenue growth over the past three years, supported largely by government projects, The company is seeking a P/E multiple of 71.7 times based on its FY24 EPS of Rs 8.6. However, after annualized 9M FY25 earning, the valuation moderates to a P/E of 24.2 times, making the offer attractive, said Choice Broking,
"It recent growth has been largely driven by its participation in the PM-KUSUM scheme, raising concerns over concentration risk and the sustainability of this growth momentum. The elongated working capital cycle and cash flow pressures add to the overall risk profile. Thus, we recommend 'subscribe for long term' rating for issue," it said.
Financially, Oswal Pumps reported a net profit of Rs 216.71 crore and revenue of Rs 1,067.34 crore for the nine months ending December 31, 2024. In the fiscal year 2023-24, it achieved a net profit of Rs 97.67 crore on revenue of Rs 761.23 crore. The company's expected market capitalisation post-IPO is estimated to be around Rs 7,000 crore.
Oswal Pumps intends to focus on increasing integration in operations to optimize margins by integrating certain processes and manufacture certain components for pumps in-house; automate specific pump manufacturing processes; and strengthen technological capabilities and enhance automation and IT interface of products through strategic acquisitions, said Master Capital.
"Urbanization in India is also driving the growth of pumps due to increased demand for water management, construction, and industrial activities in expanding urban areas. Its also plans to increase manufacturing capacity for solar modules and backward integration capabilities for solar modules. Investors looking to invest can invest in the IPO for the long term," it added.
The grey market premium (GMP) for Oswal Pumps has shown a positive trend, rebounding to Rs 60-62 per share over the weekend, indicating potential listing gains of about 10% for investors. The GMP was previously noted at Rs 45 during the initial bidding day.
The IPO allocation is divided as follows: 50% for qualified institutional buyers (QIBs), 15% for non-institutional investors (NIIs), and 35% reserved for retail investors. IIFL Capital Services, Axis Capital, CLSA India, JM Financial, and Nuvama Wealth Management are the lead managers for this IPO. MUFG Intime India (Link Intime) acts as the registrar for the issue.