Ardee Industries Ltd, a leading lead recycling company based in Tirupati, Andhra Pradesh, has launched for public subscription and will continue to be open till 7 August 2023. It has already attracted significant investors after raising Rs 127.75 crore from anchor investors before the IPO.
One of the anchor allocation highlights is the participation of renowned investor Ashish Kacholia with an investment of Rs 25 crore, which is more than 19.57% in the anchor book. Kacholia's participation has attracted the attention of both retail and institutional investors as his investment is closely monitored by the market.
IPO Details
Ardee Industries is going to raise Rs 426 crore through its public issue.
The IPO consists of:
Fresh Issue: Rs 320 crore. Offer for Sale (OFS): Rs 106 crore by promoters Sandeep Aggarwal and Nikunj Aggarwal
The company has set an indicative price band of Rs 50-53 per share of the company.
The fresh issue will be used to strengthen the company’s operations. Around Rs 220 crore is allocated for incremental working capital requirements, while Rs 20 crore will be used for repayment or prepayment of existing borrowings. The remaining funds will be used for general corporate purposes.
Strong Financial Improvement
Ardee Industries has made significant operational progress in the last few years. Market analysts said that in FY24, the EBITDA margin at Ardee Industries nearly doubled and grew from 6.1% to 12.6% in FY26—up from 6.1% in the prior fiscal year (FY24), mostly due to enhanced production capacity and better utilization of its integrated recycling plant in Tirupati.
Exports have also been a major growth driver. Exports grew at a 138.7% compound annual growth rate (CAGR) between FY24 and FY26 for the company. By FY26, Singapore and Switzerland had become the company’s largest overseas markets, demonstrating growing international demand for its products.
Business Overview
Ardee Industries is a major recycling producer of lead-acid batteries for pure lead and lead alloys, which are widely used in industries such as:
Energy storage
Electric mobility (e-mobility)
Automotive manufacturing
Chemical applications
The company operates a large integrated recycling facility with an annual processing capacity of 1.57 lakh metric tonnes (MTPA) in Tirupati, Andhra Pradesh.
Its raw material sourcing network includes 58 countries, with imported battery scrap accounting for 87% of all raw material purchases in FY26. This global sourcing strategy ensures a continuous supply of recyclable materials.
Customer Concentration Remains a Key Risk
Despite its strong growth trajectory, investors should also consider certain risks.
According to SBI Securities, Amara Raja accounted for 40.64% of the company’s revenue in FY26. Additionally, the company’s top 10 customers made up nearly 92% of the overall revenue, which is a high level of customer concentration. Any drop in demand from these major clients could also affect future earnings.
Furthermore, dependence on imported battery scrap exposes the company to fluctuations in global supply chains, import laws, and commodity prices.
Brokerage View
SBI Securities has given the IPO a “Subscribe” rating on the long-term investment side. At the top end of the price band, the IPO is priced in a post-issue Price-to-Earnings (P/E) multiple of 19.7x, which is reasonable given the company's improving profitability, expanding exports, and growth prospects in the lead recycling industry.
Should investors apply?
Ardee Industries brings investors exposure to the growing recycling and sustainable manufacturing ecosystem in India. The company’s improving margins, increasing export business, and the participation of superstar investor Ashish Kacholia have raised the stock market mood for the IPO.
Investors should be aware of the company’s customer concentration and reliance on imported raw materials. Investors with a long-term investment horizon should consider the IPO, but short-term investors should also look at subscription demand and listing sentiment before making a decision.
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