GK Energy IPO Day 2: Check GMP, subscription status. Should you apply or not?

GK Energy IPO: The initial public offer (IPO) of GK Energy opened on September 19 and will close for subscription on September 23.

The ₹464.26 crore IPO, had fixed a price band in the range of ₹145-153 apiece.

GK Energy IPO Subscription

By 5 pm on Day 2, the issue was subscribed 6.41 times. It received bids for 14.22 crore shares as against 2.12 crore on offer. The retail portion was booked 6.84 times while the non-institutional investors (NII) category was subscribed 10.05 times. Finally, the qualified institutional buyers (QIBs) quota was bid 2.90 times.

GK Energy IPO GMP

GK Energy IPO is witnessing healthy interest in the grey market, with a grey market premium (GMP) of ₹22. This suggests that the shares are trading above the issue price. At the current premium, the stock is expected to list near ₹175, which would be about 14.38 percent higher than the upper end of the price band set at ₹153.

About GK Energy IPO

GK Energy’s IPO consists of a fresh issue of 2.61 crore shares aggregating to ₹400 crore and an offer for sale of 42 lakh shares by promoters Gopal Rajaram Kabra and Mehul Ajit Shah, amounting to ₹64.26 crore.

For retail investors, the minimum bid size is 98 shares, requiring an investment of ₹14,994 at the upper end of the price band.

The basis of allotment is expected to be finalised on September 24, with the stock scheduled to list on both NSE and BSE on September 26. IIFL Capital Services Ltd. is the book-running lead manager to the issue, while MUFG Intime India Pvt. Ltd. is acting as the registrar.

GK Energy plans to utilise ₹322.5 crore from the fresh issue proceeds to meet long-term working capital requirements, while the remaining funds will go towards general corporate purposes.

Incorporated in 2008, GK Energy Limited provides EPC services for solar-powered agricultural water pump systems under the PM-KUSUM scheme, offering farmers end-to-end solutions from survey and design to installation, commissioning, and maintenance. Operating on an asset-light model, the company sources solar panels, pumps, and other components from specialized vendors and markets them under the “GK Energy” brand.

GK Energy IPO: Apply or not?

Angel One recommended investors subscribe to the GK Energy IPO. The brokerage pointed out that the Indian solar pump industry is set for strong growth, supported by government initiatives such as the PM-KUSUM scheme along with various state-level solar programs.

At the upper end of the price band of ₹153 per share, GK Energy is seen as attractively valued, trading at a post-IPO P/E of 23.3x, which is lower than its industry peers. “The company has demonstrated strong financial performance, with significant revenue and PAT growth in FY2024. Its robust order book and presence in the growing renewable energy sector further support its growth prospects,” Angel One said.

At the upper end of the price band of ₹153, analysts at Geojit Investments noted that the company’s FY25 price-to-earnings ratio appears fairly valued when compared with peers. “With strong execution capabilities and government-backed demand, GK Energy is poised for sustained growth,” Geojit said, giving the IPO a ‘Subscribe’ rating for investors with a medium- to long-term view.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.