ARC Insulation's shares were listed on NSE SME at ₹145, providing investors with a 16% listing gain. However, the shares soon fell to a lower circuit of ₹137.75. The company plans to utilize the ₹41.19 crore raised from the IPO for a new unit, office space, debt repayment, and working capital needs.
ARC IPO Listing: ARC Insulation and Insulators' ₹41.19 crore IPO was subscribed 18.71 times between August 21-25 and listed on NSE SME on Friday. The shares, which opened at ₹145 against an issue price of ₹125, reached a lower circuit of ₹137.75 due to profit-taking. The company stated that the raised funds will be used for a new manufacturing unit, office purchase, working capital, and debt repayment. Established in September 2008, ARC manufactures GFRP composite products, and its revenue and profits have been consistently growing.
IPO Received Overwhelming Response
The ARC Insulation IPO was open from August 21 to August 25. During this period, investors showed b interest. According to data, the issue was subscribed 18.71 times. The Qualified Institutional Buyers' portion was subscribed 15.12 times, Non-Institutional Investors' portion was subscribed 26.84 times, and the Retail Investors' portion was subscribed 17.27 times. The company raised ₹41.19 crore through this issue.
Where the Funds Will Be Used
The company has indicated that a significant portion of the funds raised from the IPO will be used for expansion plans. Approximately ₹8.16 crore will be spent on setting up factory sheds for a new manufacturing unit. A new office will be purchased for ₹3.06 crore. Additionally, ₹1.18 crore will be used for debt repayment. The largest portion, around ₹16.35 crore, will be allocated for working capital requirements. The remaining funds will be used for general corporate purposes.
What the Company Manufactures
ARC Insulation and Insulators was established in September 2008. The company manufactures high-performance Glass Fiber Reinforced Polymer (GFRP) composite products. Its products include GFRP rebar, tubes, gratings, and facings. These products are durable and lightweight, and are used in sectors such as infrastructure, power, cooling towers, chemical industries, electrical substations, and mining. The company's manufacturing unit is located in Ramdevpur village, South 24 Parganas, West Bengal.
Rapid Improvement in Financials
The company's financial performance has shown continuous improvement. In FY2023, ARC Insulation reported a net profit of ₹2.64 crore. This profit increased to ₹6.10 crore in FY2024 and further rose to ₹8.57 crore in FY2025. During the same period, the company's total income grew at a CAGR of over 16% to ₹33.15 crore.
While the company's profits and revenue have increased, there have been fluctuations in its debt levels. At the end of FY2023, the company had a total debt of ₹5.30 crore. This decreased to ₹2.78 crore in FY2024, but increased to ₹5.97 crore by FY2025.
Mixed Response on Listing Day
The first day for ARC Insulation was an eventful one for investors. While investors saw good listing gains in the initial hours, profit-taking pressure was observed shortly after. Consequently, the share slipped to the lower circuit. However, considering the initial volatility, investors will continue to keep a close watch on this stock.
