Oswal Pumps IPO subscribed 36% on Day 2; GMP softens despite retail interest. Should you subscribe?
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The Rs 1,387 crore initial public offering ( IPO ) of Oswal Pumps , one of India's fastest-growing solar pump manufacturers , was subscribed 36% as of the second day of bidding on Monday, with strong traction from retail and non-institutional investors even as institutional demand remained muted.By 10:44 a.m., the IPO had garnered bids for 57.89 lakh shares against the 1.62 crore shares on offer. Non-institutional investors led the way, subscribing 79% of their allocated portion, followed by retail investors at 37%. Qualified institutional buyers (QIBs) had bid for just 1% of their quota.The IPO, which opened for subscription on June 13 and will close on June 17, comprises a fresh issue worth Rs 890 crore and an offer for sale of 81 lakh shares by promoter Vivek Gupta.Ahead of the issue, Oswal Pumps raised Rs 416 crore from anchor investors on June 12 by allotting 67.78 lakh shares at Rs 614 per share to marquee institutions such as Societe Generale, Smallcap World Fund, and ICICI Prudential The price band for the IPO has been set at Rs 584–614 per share, with a lot size of 24 shares.The grey market premium (GMP) for Oswal Pumps stood at Rs 49 as of 10:02 a.m. on June 16, indicating an estimated listing price of Rs 663, an expected gain of 7.98% over the cap price. The GMP ranged between Rs 64 and Rs 65 on Friday, hinting at some cooling in unofficial demand ahead of the final day of bidding.Founded in 2000, Oswal Pumps manufactures solar-powered and grid-connected submersible and monoblock pumps, electric motors, and solar modules. The company has scaled rapidly under government initiatives like the PM Kusum Yojana and accounted for approximately 38% of India's installed solar pumps as of December 2024.It operates a large, vertically integrated facility in Karnal, Haryana, and sells through 925 distributors and 248 company-owned outlets branded as 'Oswal Shopee' as of June 2025.Financially, Oswal's growth has been robust — revenue rose from Rs 360 crore in FY22 to Rs 759 crore in FY24, while net profit surged from Rs 17 crore to Rs 98 crore. For the nine months ended December 2024, it reported Rs 1,066 crore in revenue and Rs 217 crore in profit, with an EBITDA margin of 30.1% and PAT margin of 20.3%.At the upper end of the price band, Oswal Pumps is valued at a post-issue P/E of 24.2x and EV/EBITDA of 15.1x, levels seen as reasonable when compared with peers like Shakti Pumps, KSB, and Kirloskar Brothers. Analysts note Oswal's stronger return ratios, with RoE at 72.6% and RoCE at 56%, as key positives.SBI Securities has recommended subscribing to the IPO for the long term, citing 'strong revenue and profit growth, robust order book (Rs 1,100 crore), and leadership in solar pump installations.' However, the brokerage also flagged risks such as 'dependence on government schemes and a high receivables cycle (140–150 days).'(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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