Sundrex Oil Company IPO Review: Lubricating Your Portfolio or Slippery Slope?

Sundrex Oil Company IPO Review, Sundrex Oil Company IPO Review, Sundrex Oil IPO GMP, Sundrex Oil IPO Date, Sundrex Oil Company Price Band, SME IPO 2025.

The SME IPO sector is witnessing a new entrant with the Sundrex Oil Company IPO. Established in 2010, this Kolkata-based manufacturer is looking to raise ₹32.25 Crores through a fresh issue to fuel its working capital and capital expenditure needs. With a strong foothold in the B2B industrial lubricants market, Sundrex presents an interesting proposition for investors eyeing the manufacturing sector.

This “Deep Dive” review covers every critical aspect, from the company’s business model and financial health to its Grey Market Premium (GMP) and peer comparison.

Critical Dates & Details

Event	Date / Details
IPO Open Date	Monday, December 22, 2025
IPO Close Date	Wednesday, December 24, 2025
Basis of Allotment	Friday, December 26, 2025
Initiation of Refunds	Monday, December 29, 2025
Credit of Shares	Monday, December 29, 2025
Listing Date	Tuesday, December 30, 2025
Face Value	₹10 per share
Price Band	₹81 to ₹86 per share
Lot Size	1,600 Shares

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Deep Dive: Sundrex Oil Company IPO Analysis

This analysis aims to provide a granular look at the company, helping you determine if this issue is worth your capital.

1. Business Model Analysis

Sundrex Oil Company Limited operates primarily as a manufacturer and wholesaler of high-performance industrial and automotive lubricants, greases, and specialty products. Their business model is heavily skewed towards the Business-to-Business (B2B) segment, which accounts for approximately 99% of their total revenue.

Key Business Verticals:

• Industrial Lubricants: Hydraulic oils, gear oils, and metalworking fluids tailored for heavy machinery.
• Automotive Lubricants: Diesel engine oils and transmission fluids.
• Contract Manufacturing: They provide toll blending and private labeling services for other brands, leveraging their manufacturing capacity to generate steady revenue streams.
• Specialty Products: Transformer oils and other niche applications.

Market Position:

The company has a significant presence in Eastern India and has started exploring export opportunities in neighboring countries like Nepal and Bangladesh. Their “manufacturing-led” model allows for better quality control compared to pure trading entities.

2. Financial Performance (The Numbers Game)

The financial trajectory of Sundrex Oil has been impressive, particularly in the lead-up to the IPO. The company demonstrated a robust jump in both top-line and bottom-line figures between FY24 and FY25.

• Revenue Growth: Revenue from operations surged from ₹48.31 Crore in FY24 to ₹67.20 Crore in FY25. This indicates a strong demand for their products and successful market penetration.
• Profitability: The Profit After Tax (PAT) more than doubled, rising from ₹2.57 Crore (FY24) to ₹5.44 Crore (FY25).
• Margins: The EBITDA margins improved significantly, reaching nearly 13.68% in FY25, showcasing improved operational efficiency and perhaps better pricing power in the niche B2B segment.
• Return Ratios: The company boasts a high Return on Net Worth (RoNW) of 35.63%, which is attractive for a manufacturing entity.

Red Flag / Caution:

A sudden spike in profits right before an IPO is a common pattern in SME issues. Investors should scrutinize if this growth is sustainable or a result of one-off large orders. Additionally, the Debt-to-Equity ratio stands at 1.14, indicating the company is moderately leveraged.

3. SWOT Analysis

Strengths	Weaknesses
Experienced Management: Promoters Mahesh, Shashank, and Aman Sonthalia have deep industry knowledge.	Geographic Concentration: Heavy reliance on Eastern India creates regional risk.
High Repeat Business: The B2B model ensures recurring orders from industrial clients and PSUs.	Working Capital Intensive: The business requires significant cash flow for inventory and credit to B2B clients.
Diversified Product Portfolio: A wide range of oils and greases mitigates reliance on a single product type.	Raw Material Volatility: Base oil prices are linked to crude oil, exposing margins to global price fluctuations.
Strong Financial Jump: 112% growth in PAT demonstrates scalability.	Customer Concentration: Losing a few key large industrial clients could impact revenue significantly.

4. Peer Comparison

To understand the valuation, we must compare Sundrex with its listed peers. A primary comparable is Arabian Petroleum Limited.

• Sundrex Oil Co: P/E Ratio ~10.69x (based on FY25 earnings).
• Arabian Petroleum: P/E Ratio ~8.12x.

Verdict: Sundrex Oil appears slightly more expensive than Arabian Petroleum in terms of P/E. However, Sundrex has shown a faster recent growth rate in profitability (FY24 vs FY25). The premium might be justified if the company sustains its high growth momentum, but value-conscious investors might find the pricing “fully valued.”

5. Grey Market Premium (GMP) Trends

• Current GMP: As of late December, market sources indicate a GMP in the range of ₹0 to ₹17.
• Interpretation: A GMP of ₹17 suggests a potential listing gain of around 20% over the issue price of ₹86. However, some sessions have seen the GMP flat at ₹0.
• Sentiment: The mixed GMP signals caution. Unlike some SME IPOs that command 100%+ premiums, Sundrex is seeing a more “rational” response. This implies that listing gains may be modest, and the stock is a long-term play rather than a quick flip.

6. Valuation & Conclusion

At the upper price band of ₹86, the company asks for a P/E multiple of roughly 10.7x.

• The Bull Case: You are buying a company with 35% RoE, doubling profits, and a clear expansion roadmap into exports and new industrial verticals.
• The Bear Case: You are paying a full price for a company in a highly competitive, commodity-linked sector with regional concentration risks.

Recommendation: This IPO is best suited for high-risk investors looking for medium-to-long-term holding. The lack of a massive GMP cushion means you should believe in the fundamental growth story of the Indian manufacturing sector.

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FAQ Section

Q1: What is the minimum investment for the Sundrex Oil IPO?

A: The minimum investment for retail investors is 1 Lot (1,600 Shares), which amounts to ₹1,37,600 at the upper price band of ₹86.

Q2: Is Sundrex Oil Company profitable?

A: Yes, the company is profitable. It reported a Profit After Tax (PAT) of ₹5.44 Crore for the financial year ending March 31, 2025.

Q3: Where will Sundrex Oil shares be listed?

A: The shares will be listed on the NSE SME platform.

Q4: What is the main risk in this IPO?

A: The primary risks are the volatility in raw material prices (crude derivatives) and the company’s high dependence on a limited number of B2B customers in Eastern India.

Q5: How can I check the allotment status?

A: The allotment status will be available on the registrar’s website, Cameo Corporate Services Limited, on December 26, 2025.

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