Shining Tools Limited Makes Weak Debut with 13.33% Decline, Lists at ₹98.80 Against Poor Subscription

Shining Tools Limited, a manufacturer of high-performance solid carbide cutting tools incorporated in May 2013 designing and manufacturing end mills, drills, reamers, and thread mills under the "Tixna" brand with reconditioning services for used tools, creating customised tools for automotive, engineering, aerospace, and defense industries, serving agriculture, automobiles, engineering, medical, casting, defence, aerospace, and power sectors. 

It made a weak debut on BSE SME on November 14, 2025, with significant decline of 8.77% opening at ₹104.00 and fell to ₹98.80 with losses of 13.33%, reflecting negative investor sentiment, backed by poor subscription of only 1.15 times with no anchor backing.

Shining Tools Limited Listing Details

Shining Tools launched its IPO at ₹114 per share with minimum investment of 2,400 shares costing ₹2,73,600. The IPO received poor response with subscription of only 1.15 times - retail at modest 1.87 times while NII remained severely undersubscribed at just 0.43 times.

First-Day Trading Performance

Listing Price: Shining Tools opened at ₹104.00 representing decline of 8.77% from issue price of ₹114.00, fell further to ₹98.80 (down 13.33%) hitting the lower circuit limit with VWAP at ₹103.41, delivering significant losses of ₹15.20 per share reflecting highly negative market sentiment.

Growth Drivers and Challenges

Growth Drivers:

Diversified Product Portfolio: Wide range of high-performance solid carbide cutting tools including end mills, thread mills, drills, and reamers under "Tixna" brand, customized tool solutions and reconditioning services for automotive, engineering, aerospace, and defense industries, serving diverse sectors including agriculture, automobiles, medical, casting, defence, aerospace, and power.

Efficiency and Quality Standards: Machine-based manufacturing delivering efficiency and precision, ISO 9001:2015 accredited in Quality Management for solid carbide cutting tools, manufacturing unit in strategically located Rajkot, Gujarat, experienced management and technical expertise of 26 employees providing competitive advantage.

Strong Profitability Metrics: Revenue increased impressive 39% and PAT surged exceptional 86% between FY24 and FY25, exceptional ROE of 49.59%, solid ROCE of 29.61%, outstanding PAT margin of 27.19%, remarkable EBITDA margin of 46.86% demonstrating strong operational efficiency in niche cutting tools segment.

Challenges

Sustainability Concerns and Aggressive Valuation: Boosted profits from FY24 onwards raising eyebrows about sustainability going forward, post-issue P/E of 14.66x and price-to-book of 5.82x appearing aggressively priced based on inflated recent earnings, expert review describing it as "pricey and dicey bet" recommending to skip the issue.

Small Scale and High Debt: Tiny paid-up equity capital of ₹5.66 crore post-IPO indicating longer gestation for migration to main board, elevated debt with total borrowings of ₹8.87 crore as of July 2025 against net worth of ₹9.47 crore, small scale with only 26 employees limiting operational capacity, significant promoter dilution from 96.18% to 70.68% raising concerns about exit timing.

Utilisation of IPO Proceeds

Capacity Expansion: ₹9.07 crore for purchase and installation of plant and machinery for Carbide Precision Tools at existing premises enhancing manufacturing capabilities.

Working Capital: ₹3.85 crore funding working capital requirements supporting inventory management and operational cash flows in cutting tools manufacturing business, plus ₹2.48 crore for general corporate purposes providing operational flexibility.

Financial Performance

Revenue: ₹14.77 crore for FY25, impressive growth of 39% from ₹10.60 crore in FY24, reflecting expanding operations in solid carbide cutting tools.

Net Profit: ₹2.93 crore in FY25, exceptional growth of 86% from ₹1.58 crore in FY24, though sustainability remains major concern.

Financial Metrics: Exceptional ROE of 49.59%, solid ROCE of 29.61%, RoNW of 36.60%, outstanding PAT margin of 27.19%, remarkable EBITDA margin of 46.86%, price-to-book of 5.82x, post-issue EPS of ₹7.78, P/E of 14.66x, and market capitalisation of ₹55.90 crore.