The Midwest IPO opened for public subscription on Tuesday, marking one of the most closely watched listings of the quarter. The company has set a price band of ₹1,014 to ₹1,065 per share and a lot size of 14 shares. The public offer will remain open until October 17, with allotment expected on October 20 and listing tentatively scheduled for October 24 on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
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IPO Structure and Key Figures
The issue size of the Midwest IPO is approximately ₹451 crore, consisting of a fresh issue of ₹250 crore and an offer for sale (OFS) of ₹201 crore, according to the company’s Red Herring Prospectus filed with the Securities and Exchange Board of India (SEBI). The minimum investment for retail investors stands at ₹14,910 at the upper price band.
The book-running lead managers for the issue are DAM Capital Advisors, Intensive Fiscal Services, and Motilal Oswal Investment Advisors, with KFin Technologies acting as the registrar.
- Subscription Window: October 15–17
- Anchor Allocation: October 14
- Allotment: October 20
- Listing: October 24
Company Profile: Midwest Ltd
Founded in 1994, Midwest Ltd has grown from a regional stone mining company to one of India’s leading exporters of quartz and other natural stones. Headquartered in Hyderabad, the company operates in three main business segments: mining, stone processing, and renewable energy integration. Its products are exported to more than 30 countries, including the United States, Germany, and the Middle East.
The company employs over 1,200 people across its facilities and operates multiple mining leases in Andhra Pradesh, Telangana, and Rajasthan. Rajesh Menon, the CEO and Managing Director, has emphasized the company’s focus on expanding processing capacity and adopting cleaner technologies.
Price Band, Lot Size, and Reservation Categories
The price band for the IPO is between ₹1,014 and ₹1,065 per equity share with a face value of ₹5. A single application requires a minimum lot of 14 shares, and investors can bid for multiples thereof.
Under SEBI regulations, 35 percent of the net offer is reserved for retail investors, 15 percent for non-institutional investors (NIIs), and up to 50 percent for qualified institutional buyers (QIBs). A discount of up to ₹101 per share will be offered to employees under the employee reservation category.
Financial Performance Snapshot
Midwest reported revenues of ₹1,095 crore in FY24, up from ₹960 crore in FY23, representing a year-on-year growth of nearly 14 percent. Net profit after tax for FY24 stood at ₹132 crore, while operating margins remained at 18.5 percent.
The company’s total debt stood at ₹278 crore as of March 2025. A portion of the IPO proceeds will be used to reduce debt, potentially improving its balance sheet and credit profile.
According to ICRA Ratings, Midwest’s stable export demand and planned capacity expansion support its growth outlook, but rising input costs and regulatory clearances remain key challenges.
Business Strategy and Use of Proceeds
Midwest plans to use IPO proceeds to finance its next phase of growth. These include:
- Expanding quartz processing facilities through its subsidiary Midwest Neostone.
- Purchasing electric dump trucks to modernize its mining operations.
- Integrating solar power into selected sites to reduce energy costs.
- Repaying and prepaying existing borrowings.
- Funding general corporate purposes.
The company believes this expansion will improve operational efficiency and strengthen its position in global markets.
Industry Context and Market Outlook
India’s natural stone and mineral industry is valued at over USD 6 billion and has grown steadily due to rising global demand for quartz and engineered stones. Exports account for nearly 60 percent of industry revenues, with major buyers in North America and Europe.
Government initiatives promoting mining sector formalization and infrastructure investment have further boosted investor interest. However, environmental regulations and rising logistics costs remain constraints.
According to Fitch Ratings, India’s mining sector is expected to grow at an annualized rate of 8 to 10 percent over the next three years, supported by industrial and real estate demand.
Peer Comparison
Midwest operates in a competitive segment, with peers such as Pokarna Ltd and Aro Granite Industries. Compared to its peers, Midwest has a more diversified export base and slightly higher operating margins.
| Company Name | FY24 Revenue (₹ crore) | Net Profit Margin | P/E Ratio |
|---|---|---|---|
| Midwest Ltd (IPO) | 1,095 | 12.1% | 24x |
| Pokarna Ltd | 1,210 | 11.5% | 22x |
| Aro Granite Industries | 860 | 8.3% | 18x |
This comparison indicates Midwest’s premium pricing, which analysts attribute to its integrated operations and upcoming capacity expansion.
Grey Market Premium and Market Sentiment
As of Tuesday morning, the grey market premium (GMP) hovered around ₹0 to ₹10 per share, suggesting cautious investor sentiment. Analysts view this as an indication of fair pricing but limited speculative interest.
Rakesh Sharma, senior research analyst at Motilal Oswal Financial Services, said, “The modest GMP shows investors are waiting to see how institutional buyers respond before committing heavily. Fundamentals are sound, but the valuation leaves little room for short-term listing gains.”
Investor Sentiment and Expert Opinions
Market analysts are divided on the IPO. Some highlight the company’s strong export base and capital efficiency, while others point to high valuation multiples.
Dr. Anya Mehta, independent market strategist, said, “Midwest is well positioned in its sector and the proceeds will strengthen its balance sheet. However, the sector is cyclical, and valuations are rich compared to its peers.”
Another analyst, Vikram Bhatia of Edelweiss Securities, added, “This IPO might appeal more to long-term investors rather than those seeking quick listing gains.”
Regulatory and ESG Considerations
Mining and stone processing are regulated sectors with strict environmental norms. Midwest has highlighted its commitment to sustainability, including plans to transition 20 percent of its operations to solar power within three years.
The company is also pursuing certifications for responsible mining practices, which may enhance its attractiveness to international institutional investors.
How to Apply for the Midwest IPO
Retail investors can apply for the Midwest IPO through ASBA (Application Supported by Blocked Amount) or UPI-based platforms provided by banks and brokers.
- Minimum application: One lot of 14 shares
- Maximum application for retail investors: 13 lots
- Mode: Online through trading apps or bank portals
Experts advise retail investors to evaluate the company’s fundamentals and not rely solely on grey market signals.
Key Risks and Opportunities
Risks:
- Exposure to commodity price volatility.
- Regulatory delays in environmental and mining clearances.
- Dependence on export markets.
Opportunities:
- Growing demand for quartz in construction and design sectors.
- Expansion of production capacity.
- Renewable energy integration to reduce operational costs.
Conclusion
The Midwest IPO comes at a time when India’s primary market remains active despite global headwinds. The company’s strong operational base, expansion strategy, and commitment to cleaner technologies could make it attractive to long-term investors. However, its high valuation and exposure to cyclical factors warrant careful consideration.
Investor response in the coming days will indicate how the market views Midwest’s growth story and pricing.
