Defrail Technologies Limited Makes Exceptional Debut with 28.38% Premium, Lists at ₹95.00 Against Outstanding Subscription

Defrail Technologies Limited, incorporated in 2023 engaged in manufacturing rubber parts and components including rubber hoses and assemblies, rubber profiles and beadings, and moulded rubber parts serving automotive, railways, and defence sectors offering standard products and customised solutions tracing origins to 1980 with Vikas Rubber Industries followed by Impex Hitech Rubber in 2008 consolidated into Defrail Technologies through Business Transfer Agreements on April 1, 2024, equipped with advanced machinery producing diesel and petroleum hose pipes, LPG hose pipes, nylon tubes, gaskets, grommets, air intake hoses, EPDM profiles, sponges, and aluminium window rubber beadings holding ISO 9001:2015 certification registered as seller on Government e-Marketplace with 298 permanent employees, made an exceptional debut on BSE SME on January 19, 2026. After closing its IPO bidding between January 9-13, 2026, the company commenced trading with a premium of 28.38% opening at ₹95.00 and touched ₹99.75 (up 34.80% hitting upper circuit).

Defrail Technologies Limited Listing Details

Defrail Technologies launched its IPO at ₹74 per share with minimum investment of 3,200 shares costing ₹2,36,800. The IPO received outstanding response with subscription of 105.54 times - individual investors at 101.28 times, QIB at 71.09 times, NII at 160.95 times .

First-Day Trading Performance

Listing Price: Defrail Technologies opened at ₹95.00 representing exceptional premium of 28.38% from issue price of ₹74.00, touched high of ₹99.75 (up 34.80% hitting upper circuit) and low of ₹90.25 (up 21.96%), with VWAP at ₹94.91.

Growth Drivers and Challenges

Growth Drivers:

Strong Growth Trajectory: Revenue surged from ₹0.72 crore in FY24 to ₹62.22 crore in FY25 reflecting business consolidation through transfer agreements, PAT increased from ₹0.11 crore to ₹3.42 crore, exceptional ROE of 73.72% for FY25, ROCE of 24.43%, RoNW of 73.72%, PAT margin of 5.49%, EBITDA margin of 9.29%.

Strategic Positioning: RDSO-approved vendor enabling supply to Indian Railways sector, registered seller on Government e-Marketplace for government procurement tenders, diversified product range serving automotive, railways, and defence industries.

Operational Capabilities: Two manufacturing plants in Faridabad with 7,253.33 square yards total area, advanced machinery for wide range of rubber products, in-house testing and R&D center supporting quality and innovation, ISO 9001:2015 certified.

Business Model: Operates on B2B model supplying bulk orders to automotive sector clients, serves B2G segment delivering to Indian Railways and Defence, strong relationships with customers and suppliers supporting stable operations.

Challenges:

Financial Metrics Volatility: Exceptional ROE of 73.72% for FY25 declining to 11.44% for September 2025, thin PAT margin of 5.49% in FY25 declining to 3.85% in September 2025 raising sustainability concerns.

Leverage and Scale: Debt-to-equity of 1.27 in FY25 improving to 1.11 in September 2025, total borrowings of ₹11.56 crore, significant promoter dilution from 100% to 73.52%.

Utilisation of IPO Proceeds

Equipment Purchase: ₹7.96 crore for purchase of equipment and machineries enhancing manufacturing capabilities.

Solar Installation: ₹1.73 crore for purchase and installation of solar panel reducing energy costs and supporting sustainability.

General Corporate Purposes: Remaining proceeds for general corporate purposes supporting operational needs.

Financial Performance

Revenue: ₹62.22 crore for FY25, dramatic increase from ₹0.72 crore in FY24 reflecting business consolidation through transfer agreements bringing together legacy operations from Vikas Rubber Industries and Impex Hitech Rubber.

Net Profit: ₹3.42 crore in FY25, growth from ₹0.11 crore in FY24, demonstrating profitability improvement following consolidation.