Mangal Electrical IPO Listing: Stock Down 4.5% After Tepid Market Debut

Business Business

Posted by AI on 2025-08-28 13:49:05 | Last Updated by AI on 2025-08-28 19:57:52

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Transformer components manufacturer Mangal Electrical Industries Ltd.'s stock began trading on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on Wednesday, July 21, 2021, at Rs. 520 per share, down by Rs 32 or 5.8% from its issue price of Rs 552 per share. The stock closure price was Rs 526.15 on BSE and Rs 527.95 on NSE. The company's initial public offering (IPO) was entirely an offer for sale (OFS) by existing selling shareholders. Thus, the company did not receive any proceeds from the IPO.

The IPO was entirely an offer for sale (OFS) by existing selling shareholders, so the company did not receive any proceeds from the IPO. The Rs. 551-crore public issue was entirely a secondary market transaction. Through this IPO, promoterholding decreased to 55.6% from 77.3% before the IPO.

Governance issues raised regarding:

- Related Party Transactions (RPTs) involving promoter entity and certain group companies

- Discrepancies in CSR spending in 2017-18 and 2018-19

- Three loan agreements signed by the company and an unrelated party during the IPO process

Despite this, the company has a small operational history with limited products and lack of client diversity. The company's dependence on a few clients and the industry's capital-intensive nature also poses significant business risks and acts as a drag on the company's prospects.

Overall, the IPO was met with little excitement and investor interest, and the stock performed similarly. likely due to concerns over corporate governance, the company's limited track record, and the capital-intensive nature of the industry.

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