BMW Ventures shares list at sharp 21% discount to IPO price – News Air Insight

Shares of BMW Ventures made their stock market debut on Wednesday, listing at a steep discount on both exchanges. The stock opened at Rs 78 on the NSE, down 21.21% from its IPO price of Rs 99. On the BSE, it listed at Rs 80, reflecting a 19.19% discount.

Ahead of the listing, BMW Ventures shares traded at a grey market premium of 0%, suggesting a flat debut. However, the actual listing came in lower than unlisted market expectations.

The Rs 231.66 crore IPO, which ran from September 24 to September 26, was entirely a fresh issue of 2.34 crore shares. The response from investors was moderate, with an overall subscription of 1.5 times.

Qualified institutional buyers led the demand, subscribing 3.1 times their quota, while non-institutional investors subscribed 3 times. The retail portion, however, was undersubscribed at 0.99 times, showing lukewarm participation from small investors.

Business profile

BMW Ventures is engaged in the trading and distribution of steel products, tractor engines and spare parts, along with the manufacturing of PVC pipes, roll forming, and fabrication of pre-engineered buildings.

The company supplies its steel products through a large network of 1,299 dealers across 29 districts in Bihar, supported by six stockyards located in Purnea and Patna. Over time, it has built a strong distribution presence in its core market, catering to both exclusive and non-exclusive dealers.

Financially, the company reported revenues of Rs 2,067 crore in FY25, up 6% from the previous year. Profit after tax rose 10% to Rs 32.8 crore. Margins remain thin, with PAT margin at 1.6% and EBITDA margin at just over 4%. On valuation, the stock is priced at a post-issue P/E of 26 times, which analysts say looks expensive for a company in a low-margin, competitive segment.

Also read: LG Electronics India IPO: Company sets price band at Rs 1,080-1,140 for Rs 11,607 crore issue. Check details

IPO proceeds

The IPO proceeds are largely earmarked for working capital needs, which highlights the company’s dependence on debt-heavy operations to sustain growth. Analysts note that while BMW Ventures has a strong distribution network and a diversified product base, its inconsistent earnings track record and thin margins make it a risky bet in the near term.

The stock’s future trajectory will depend on whether the company can improve margins, reduce debt, and demonstrate consistent profitability in a highly fragmented market.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)