10 lakh shares to unlock Monday in this Sunil Singhania-backed stock. Smallcap down 24% from IPO price

Mangal Electrical Industries’ pre-listing shareholder lock-in is likely to be lifted on Monday, November 24 and nearly 10 lakh shares accounting for 4% of the total outstanding shares are set to enter the markets, according to Nuvama’s estimates.

While the shares will be eligible for sale, the onus rests with the investors whether to sell them or not.

Mangal Electrical Industries, which manufactures and supplies critical components for transformers, which are used in electricity transmission and distribution, had a forgettable market debut as the shares were listed at a discount of nearly 1% over the issue price of Rs 561. On the BSE, the shares were listed at 558 while on the NSE at Rs 556.

The story has been no different since its August 25 listing. The stock has plunged 24% over the IPO price to 427.05.

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Marquee investors

The company raised Rs 120 crore from 10 anchor allotments, which include names like Abakkus Diversified Alpha Fund, backed by Abakkus Asset Manager founder Sunil Singhania. Around 31.7% of the anchor portion was allocated to the fund at the upper price band of Rs 561. Societe Generale was the other major investor in the issue.Mangal Electrical Industries reported a 7% fall in the company’s September quarter net profit at Rs 13 crore versus Rs 14 crore in the year-ago period. The total revenue stood at Rs 156 crore in the quarter under review, up 17% versus Rs 133 crore reported in the year-ago period.Brokerage SBI Securities had recommended a ‘Subscribe’ view on the issue with a long term view.

“Its products such as CRGO (Cold Rolled Gran Oriented) laminations, amorphous cores, ICBs (Immersed Circuit Breaker) and coils form part of small transformer, distribution transformer or large transformers & generators. The company’s wide product basket—from CRGO laminations & amorphous cores to transformers and EPC services—makes it a one-stop solution provider in the transformer value chain,” the brokerage note said.

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