(Image Source: Upstox)
Shyam Dhani Industries made its stock market debut on Tuesday with shares jumping 90 percent from the issue price. The spices company opened at Rs 133 per share on NSE Emerge, up sharply from the Rs 70 IPO price. The listing valued the company at around Rs 282 crore. The debut capped off one of the most aggressively subscribed SME IPOs of the year, with bids coming in at roughly 900 to 1,000 times the shares on offer.
The IPO and Subscription Frenzy
Shyam Dhani Industries raised Rs 38.49 crore through its initial public offering between December 22 and 24. The company priced shares at Rs 70, the upper end of a Rs 65-70 band. Each lot required a minimum investment of Rs 2.8 lakh, putting the offering within reach of retail investors but still requiring meaningful capital commitment.
The extraordinary subscription drove intense trading in the grey market before listing. Unlisted shares traded at roughly double the IPO price in grey market dealings, signaling strong demand ahead of the formal debut. When listing finally came on Tuesday, actual trading at 90 percent premium was robust but slightly below grey market expectations of around 100 percent premiums seen on Monday.
What Shyam Dhani Does
The company processes and manufactures spices, herbs, and condiments under the SHYAM brand. It operates from a facility in Gujarat and sells through wholesale and retail channels. The IPO proceeds will fund working capital needs, pay down some existing debt, spend on marketing and brand building, install additional processing machinery, and put a solar plant on the factory roof.
This mix of spending reflects a company trying to grow while managing costs. The solar investment and debt reduction suggest management wants to improve margins alongside pushing for higher sales. For a spices company competing against established names, brand visibility matters, which is why marketing gets a meaningful share of the IPO funds.
What This Means for SME IPO Investors
The Shyam Dhani debut will reinforce the perception that SME IPOs can deliver huge listing gains. Nearly doubling in price on day one looks attractive to investors. But there’s a catch. SME stocks often suffer from thin liquidity after listing, making it harder to exit positions at favorable prices. They also tend to see sharp swings in price based on company news or broader market sentiment.
For investors holding shares at Rs 133, the real test begins now. Shyam Dhani needs to execute its expansion plans, grow revenue, and improve profitability to justify the higher valuation. Quarterly results will show whether the company can convert IPO capital into actual business growth or whether the debut premium becomes just a one-day pop that reverses once early investors cash out.
The debut rewards IPO allottees on paper. Whether those gains stick depends on company performance over the next few years.
