Paras defence shares nearly triple on bumper debut against issue price1 min read . Updated: 01 Oct 2021, 12:53 PM IST
- Paras Defence IPO received a whopping 304.26 times subscription on the back of massive investors' interest for the public issue
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Shares of Paras Defence and Space Technologies made a stellar debut on the Indian bourses on Friday. The stock listed at ₹469 per share on the NSE, around 170% premium from its IPO issue price of ₹175 apiece. On BSE, Paras Defence shares extended gains by rising to ₹500 level, nearly triple from its issue price.
Paras Defence had a stellar debut today on bourses given its niche presence in the defence and space, said Hemang Jani, Head, Equity Strategy, Broking & Distribution, Motilal Oswal Financial Services.
"It is looking to tap import substitution opportunities under GoI’s Atmanirbhar Bharat and ‘Make In India’ initiatives. Thus we like Paras given its complex/wide product portfolio, presence in niche defense/space, strong client relationship and high entry barriers. Given the huge impetus on the defense by the government, the stock presents good opportunity for investors to participate in this niche space," he added.
Mirroring massive investor interest, the three-day initial public offer (IPO) of Paras Defence received a whopping 304.26 times subscription. The issue was fully subscribed within minutes of opening on the first day of bidding that opened on September 21.
Paras Defence IPO included a fresh issue of up to ₹140.6 crore and an offer for sale of up to 17,24,490 equity shares. The initial share sale's price range was fixed at ₹165-175 apiece. The company had garnered a little over ₹51 crore from anchor investors ahead of its IPO.
Paras Defence is engaged in designing, developing, manufacturing, and testing a wide range of defence and space engineering products and solutions. Proceeds of the fresh issue is said to be used to fund capital expenditure requirements, to support incremental working capital needs, and repayment or prepayment of loans availed by the company.
The company's business is highly dependent on projects and programmes that are undertaken by the central government and associated entities, such as defence public sector undertakings and government organisations involved in space research.
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