Highlights: Midwest IPO GMP surges 9% ahead of listing on October 24 – Will it deliver a surprise?

As per the information available via the Midwest DRHP, it employs over 1,000 skilled personnel, including specialists in mining, production, research, and development (R&D). The R&D focus is on expanding the resource base through exploration and optimising production techniques to enhance quality and reduce costs, particularly in diamond wire manufacturing. The clientele spans 17 countries, with key export markets including China, Italy, and Thailand, with longstanding contractual relationships that ensure steady cash flows and reduce working capital needs.

Midwest is expanding its product portfolio through new ventures including extraction of branded Laza Grey Marble and Celestia Quartzite for the Indian market and potential European exports, as well as entering heavy mineral sand mining via subsidiaries in Sri Lanka. They hold licences for minerals like rutile, ilmenite, zircon, and garnet, essential for titanium pigment, aerospace materials, electronics, and medical implants. Investment in exploration for these high-value minerals, including monetisation potential from rare earth element-containing monazite, reflects ongoing diversification ambitions.

Midwest’s revenue forFY25 stood at Rs 626.18 crore with the core natural stone segment contributing 96% of revenues, dominated by Black Galaxy and Absolute Black Granite sales both domestically and internationally. The diamond wire segment, initially set for backward integration, now supplies both captive consumption and third-party Indian mining and construction industries.

In Q1 FY26, Midwest commenced its quartz processing operations in Andhra Pradesh with Phase I capacity of 303,600 metric tonnes per annum of quartz grit and powder, used for engineered stone and solar glass. Phase II, funded by the offer proceeds, aims to double capacity to 606,600 tonnes, including production of ultra-high purity quartz powder for semi-conductors and optical glass applications.

Some of the key objectives for Midwest IPO includes-

-Funding capital expenditure for Phase II of the quartz grit and powder processing plant (the “Phase II Quartz Processing Plant”)

-Capital expenditure for purchase of electric dump trucks

-Capital expenditure for integration of solar energy at certain Mines

-re-payment/re-payment of, in part or full, certain outstanding borrowings of the Company and investment in APGM, by way of a

loan, for pre-payment/ re-payment of, in part or full, certain outstanding borrowings of APGM

According to HDFC Securities, investors should watch out for 3 key concern areas with respect to Midwest company fundamentals-

-One promoter received a CBI notice in 2015 related to subsidiary operations

-Estimates of natural stone reserves and mine life may differ materially from actual recoveries, impacting financials.

-Mining operations require multiple permits which may face delays or legal challenges, adversely affecting production.

The Midwest IPO GMP indicates that the issue may list at a premium of 9% or more. However, readers must remmeber that the GMP is an unofficial measure of investor sentiment. The listing price may differ significantly from the issue price.

Telangana-based Midwest operates 16 granite mines across Telangana and Andhra Pradesh, producing premium Black Galaxy found exclusively in a single village in Andhra Pradesh and Absolute Black granite, both widely used in global real estate projects.

DAM Capital Advisors, Intensive Fiscal Services and Motilal Oswal Investment Advisors are the book running lead managers to the offer.

The initial public offer of Midwest Ltd was fully subscribed within hours of bidding starting on Wednesday, attracting a total subscription of 1.84 times on the first day. According to NSE data, the three-day IPO got bids for 27,39,83,178 shares against 31,17,460 shares on offer.

The portion for non-institutional investors garnered 168.07 times subscription while the category for Qualified Institutional Buyers (QIBs) got subscribed 139.87 times. The quota meant for Retail Individual Investors (RIIs) received 24.26 times subscription.

Quartz processor Midwest Ltd on Tuesday said it has mobilised Rs 135 crore from anchor investors.

The public issue has a price band of Rs 1,014-1,065 per share.

The IPO is a combination of a fresh issue of shares worth Rs 250 crore and an offer-for-sale (OFS) of Rs 201 crore.

Of the fresh issue, Rs 130.3 crore will go towards Phase II expansion of its quartz facility under subsidiary Midwest Neostone, Rs 25.7 crore for electric dump trucks, and Rs 3.2 crore for solar energy integration at select mines.

Additionally, Rs 56.2 crore will be used to repay borrowings, with the remainder earmarked for general corporate purposes.

The Grey Market Premium for the Midwest IPO has now risen to Rs 115 — indicating an estimated listing price of Rs 1180.

Investors can check the Midwest IPO allotment status through the BSE website once it is finalised.

– Open the BSE India website or click on this direct link

– Select Equity under Issue Type

– Choose Midwest from the dropdown.

– Enter application number and PAN

– Click on Search to check if you’ve been allotted shares

The IPO was subscribed to a total of 92.4 times. The retailers booked the issue 25.52 times, and the employee section was booked 26 times. The issue saw a massive interest from QIBs and NIIs. The QIBs booked the issue 147 times, while the NIIs booked it 176.57 times.

Midwest, established in 1981, is an Indian company that mines, processes, and exports natural stone, including granites and quartz. It is the main producer of Black Galaxy granite, a variety found in Andhra Pradesh, and exports its products to over 17 countries such as China, Italy, and Sweden.

KFin Technologies, the official registrar for the Midwest IPO, also provides allotment status online. Visit the KFin Technologies IPO status page, choose ‘Midwest IPO’ from the dropdown, and enter your PAN, application number, or DP/Client ID. Once you click ‘Submit’, your allotment details will be displayed on the screen.

To check the allotment via NSE, head to the NSE IPO application status page. After clicking on ‘Equity and SME IPO Bid Details’, select ‘Midwest IPO’ from the available options. Enter your PAN or application number, submit the details, and you’ll be able to view your allotment result instantly.

Investors can easily check their Midwest IPO allotment status through the BSE portal. Visit the BSE IPO allotment page, select ‘Equity’ as the issue type, and choose ‘Midwest IPO’ from the dropdown list.

Then, enter your application number or PAN, complete the captcha verification, and click on ‘Search’ to know if you’ve received any shares.

The IPO received strong demand, being subscribed 87.89 times overall. Qualified Institutional Buyers (QIBs) applied 49.5 times, Non-Institutional Investors (NIIs) 133.7 times, and retail investors 19.4 times.

The total IPO size was Rs 451 crore, which included a fresh issue of Rs 250 crore and an offer for sale of Rs 201 crore by promoters Guntaka Ravindra Reddy and Kollareddy Rama Raghava Reddy.

The IPO was offered at a price range of Rs 1,014 to Rs 1,065 per share, with a minimum lot size of 14 shares. Retail investors needed to invest at least Rs 14,910 to apply.

The Midwest IPO was open for subscription from October 15 to October 17. The shares are expected to list on both NSE and BSE on October 24.

The company manages the entire value chain, from quarrying to global distribution. It also produces diamond wire cutting tools and has recently expanded into quartz processing with a new plant, diversifying its business activities.

The IPO was managed by DAM Capital Advisors, Motilal Oswal Investment Advisors, and Intensive Fiscal Services. KFin Technologies served as the registrar for the issue.

The company plans to use the IPO proceeds for:

Expansion of the quartz processing plant (Phase II) under Midwest Neostone

Purchase of electric dump trucks for mining

Solar energy integration projects

Repayment of existing debt and other corporate purposes

Midwest operates in the natural stone and quartz sector, managing the full value chain from mining and processing to export and distribution. The company is India’s largest producer and exporter of Black Galaxy Granite and Absolute Black Granite, catering to both domestic and international markets.