BackHarsha Engineers IPO sees strong demand, subscribed over 74 times on last day. Check latest GMP
Harsha Engineers IPO has a fresh issue of up to ₹455 crore and an offer for sale of up to ₹300 crore
PremiumThe initial public offer (IPO) of Harsha Engineers International opened for public subscription on Wednesday and the three day issue will close on Friday. The price range for the offer has been fixed at ₹314-330 per share. As of 5 pm on last day, the issue has been overall subscribed nearly 75 times with retail investors' category booked 17x and Qualified Institutional Buyers(QIBs) 178.26 times.
As per market observers, Harsha Engineers shares are available at a premium (GMP) of ₹230 in the grey market today. The company's shares are expected to list on leading stock exchanges BSE and NSE on Monday, September 26, 2022.
The ₹755-crore IPO consists of a fresh issue of equity shares aggregating to ₹455 crore, and an offer-for-sale (OFS) of up to ₹300 crore by existing shareholders.
Proceeds from the fresh issue to the tune of up to ₹270 crore will be utilised for debt payment, up to ₹76 crore for funding working capital requirements towards purchase of machinery, up to ₹7 crore for infrastructure repairs and renovation of the existing production facilities and for general corporate proposes.
Harsha Engineers International Ltd is the largest manufacturer of precision bearing cages, with 50-60% market share in the organized market. It offers diversified suite of precision engineering products across geographies and end-user industries. It operates under 2 business divisions - engineering business and solar EPC business.
Based in Ahmedabad, the company has five manufacturing facilities with two of its principal manufacturing facilities at Changodar and one at Moraiya, near Ahmedabad in Gujarat in India, and one manufacturing unit each at Changshu, China and Ghimbav Brasov in Romania, which allow access to its customers in over 25 countries.
As of March 31, 2022, it has manufactured more than 7,205 bearing cages and more than 295 other products. In addition, over the past three years its product development and innovation center has developed more than 1,200 products in different bearing types.
“In terms of valuations, the post-issue P/E works out to 32.7x FY22 EPS (at the upper end of the issue price band). Company’s consolidated PAT has grown at CAGR of ~105% over FY20-22 on back of margin expansion. HEIL has diverse product portfolio and strong expertise; we believe that these positives are yet to be factored in the valuations commanded by the company," said brokerage Angel One.
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