Studds Accessories IPO Day 2: Issue Subscribed 1.54x,  GMP, Details, and Expert Review

We’re seeing strong buzz around the IPO of Studds Accessories Ltd. This firm makes helmets and accessories for two-wheelers. On Day 2 of its subscription, the issue was 1.54 times subscribed. We’ll look at the company, the offer, the numbers, the market outlook, the strengths and risks, and what the listing might look like. Our goal? Help you make sense of this IPO in simple terms.

Company Background

Studds Accessories Ltd is one of India’s leading manufacturers of two-wheeler helmets and accessories. It sells helmets and gear under its own brands, including Studds and SMK. According to reports, the company has sold over 7.4 million helmets in FY2025 and exports to more than 70 countries. Based in Faridabad, Haryana, it also supplies helmets to major original equipment manufacturers (OEMs) in India and abroad. The business is well-positioned in a large domestic two-wheeler market, and it benefits from rising safety awareness and regulations on helmets.

IPO Key Details

Here are the key facts about the IPO:

• Issue size: ₹ 455.49 crore.
• The share price range has been fixed between ₹557 and ₹585.
• Lot size: Minimum 25 shares.
• The offer is entirely an offer for sale (OFS) of existing shareholders, meaning the company does not raise fresh funds.
• Subscription window: Opened 30 Oct 2025, closes 3 Nov 2025.
• Listing likely around 7 Nov 2025.

These details give a clear picture of what the IPO is offering and how it’s structured.

Day 2 Subscription Status (1.54×)

We see strong early demand. On Day 1, the issue was already subscribed 1.54×. On Day 2, it improved further, reaching about 1.55× according to some reports. Breaking down by investor category (Day 1 data):

• Retail Individual Investors (RII): ~2.16×.
• Non-Institutional Investors (NII): ~2.14×.
• Qualified Institutional Buyers (QIB): ~0.02× (very low demand from large institutions).

So, we note strong interest from retail and NIIs, but low interest from big institutional players. That’s a meaningful nuance for investors.

Grey Market Premium (GMP) Update

GMP gives an early signal of how the unlisted share market views the listing’s upside. For Studds:

• GMP on opening: around ₹ 53 per share over the issue price.
• GMP improved to about 10.8% premium on Day 2 (i.e., GMP ≈ ~₹ 63 on the upper price band).

This suggests investors expect a modest listing gain. But GMP is not guaranteed; it reflects sentiment in the grey market, which can change.

Financial Performance

Studds has shown solid numbers:

• In FY 25, total income rose ~11% to ₹ 595.9 crore. PAT was ₹ 69.6 crore.
• EBITDA margin around 18%; PAT margin ~11.9%.
• Return on Equity (ROE) ~16.6%; Return on Capital Employed (ROCE) ~20.3%.
• Virtually debt-free.

These metrics show the company is healthy and executing well. But valuation is key, at upper band, the P/E (Price/Earnings) is ~28.5× based on estimated FY26 earnings. So while growth is steady, the price might not leave much margin for error.

Industry & Market Outlook

Here are some favourable macro trends:

• India remains the world’s largest two-wheeler market in many contexts. Helmets are mandatory and enforcement is stronger. That boosts demand for quality helmets.
• The export potential is large: Studds already exports to 70+ countries.
• Premium riding gear and accessories (beyond helmets) are growing as more consumers move from basic bikes to premium models or start sports riding.
• The company faces competition from peers (e.g., Steelbird Helmets, Vega Helmets) and imports. But Studds’ large scale gives it an advantage.

So we can say the industry tailwinds are favourable. But they also hinge on consumer spending, regulatory moves, and raw material costs.

Strengths & Opportunities

What are the company’s strong points?

• Strong brand portfolio: “Studds” and “SMK”. It caters to both the commuter market and premium segments.
• Large manufacturing footprint + exports give global reach.
• No major debt, which gives operational flexibility.
• Growth through a premium product mix and exports.
• Regulations increasingly favour helmet safety and standardisation, which helps organised players like Studds.

We see good opportunity for growth in the next 2-3 years, especially with rising disposable income and premiumisation of bikes.

Risks & Challenges

But no company is risk-free. Here are some key risks:

• Competition & pricing: If rivals lower prices or work aggressively, margins may get squeezed.
• Raw material costs: Helmet manufacturing involves plastics, foam, composite shells, and imports. Volatility in prices or supply chain disruptions can impact costs.
• Regulation & standards: Any delay in certification, quality issues, or recall risk could hurt brand and finances.
• Two-wheeler market dynamics: If economic slowdown hits, sales of bikes may drop, and accessory purchases may weaken.
• Valuation risk: With the price band valuing the company at ~28.5× earnings, if growth slows or margins dip, return expectations may get hit.

Expected Listing Scenario

Based on GMP and subscription numbers, here’s what we might expect:

• With GMP around ₹ 63 on upper band of ₹ 585, estimated listing price could be ~₹ 648 (≈10.8% upside) if sentiment holds.
• Because institutional demand is low, listing day may see higher volatility, listing gains might be limited if institutions don’t support price.
• For long-term investors, the listing price should not be only focus; growth potential over 3-5 years matters more.
• If you apply, consider yourself partly a listing-gain trader and partly a medium-term investor. Be ready for fluctuations.

Conclusion

To wrap up: We see the Studds Accessories IPO as a solid offering with credible business fundamentals and favourable industry tailwinds. The strong subscription from retail investors and rising GMP hint at positive sentiment. But the valuation is relatively premium, and institutional backing is weak, which raises caution.
If you’re aiming for short-term listing gains, the ~10% upside seems plausible but not huge. If you’re thinking longer term (3-5 years) and believe in the company’s growth story, then the IPO might be worth a look, provided you accept the risks.
As always, we recommend making an investment decision based on your personal risk tolerance, time horizon, and diversification strategy.

FAQS:

Disclaimer:

The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.