SRM Contractors IPO Day 2: Check GMP, subscription status, review. Should you subscribe to the issue?

The SRM Contractors IPO got off to a strong start yesterday (Tuesday, March 26), and it will end on Thursday, March 28. According to BSE data, the total subscription status for the SRM Contractors IPO on Day 1 was 3.56 times. The non-institutional investors (NIIs) component was booked 6.26 times, while the retail portion was subscribed 3.55 times. The qualified institutional buyers (QIBs) portion was booked 1.57 times.

Also Read: SRM Contractors IPO Day 1: Issue fully booked on strong retail, NII interest; check GMP, subscription status, more

The IPO price band for SRM Contractors is set at ₹200 to ₹210 per share, with a face value of ₹10. Bids can be placed for multiples of 70 shares, with a minimum bid of 70. It has set aside not less than 15% for NII, a maximum of 50% of the shares for QIB, and a not less than 35% of the shares for retail investors.

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The SRM Contractors IPO garnered ₹39 crore from anchor investors on Friday, March 22.

The SRM Contractors IPO share allotment date is tentatively set for Monday, April 1. The shares will be credited to the demat accounts of the allottees on the same day as the reimbursement date, which is Tuesday, April 2. SRM Contractors share price is likely to be listed on BSE and NSE on Wednesday, April 3.

Also Read: SRM Contractors IPO opens today: GMP, review, subscription status, other details. Apply or not?

SRM Contractors engages in all kinds of civil building projects in Jammu & Kashmir and Ladakh, two Union Territories. Its initiatives include the construction of tunnels, slope stabilization projects, roads (including bridges), and other minor ones.

With the technical know-how to complete projects in the region's challenging terrain, the firm has grown to be a major participant in the infrastructure development sector in the Union Territories of Jammu & Kashmir and Ladakh.

SRM Contractors IPO Subscription Status 

On the second day, the issue received overwhelming response from NIIs, followed by retail investors and QIBs. The overall SRM Contractors IPO subscription status was 17.42 times, as per BSE data. The retail portion was subscribed 13.95 times, and NII portion was booked 45.51 times. The QIBs portion was booked 2.41 times.

SRM IPO has received bids for 7,55,93,770 shares against 43,40,100 shares on offer, according to data from the BSE.

The retail investors' segment received bids for 3,02,77,100 shares against 21,70,000 shares on offer for this segment.

The NIIs portion got bids for 4,23,25,500 shares against 9,30,000 on offer for this segment.

The QIBs segment got bids for 29,91,170 shares against 12,40,100 on offer for this segment.

SRM Contractors IPO details

The SRM IPO comprises a fresh issueof up to 62,00,000 equity shares, with an aggregate value of ₹130.20 crore. There is no offer-for-sale component.

The business plans to use the net proceeds from the offering to achieve the following objectives: covering working capital requirements; repaying existing secured loans in full or in part; participating in joint ventures tailored to particular projects; and general corporate purposes. Funding will also be available for the capital costs associated with purchasing machinery and equipment.

The book running lead manager for the SRM Contractors IPO is Interactive Financial Services Ltd, and the registrar is Bigshare Services Pvt Ltd.

Also Read: SRM Contractors IPO: 10 key risks to consider before subscribing to the issue

SRM Contractors IPO GMP today

SRM Contractors IPO GMP is +95. This indicates SRM Contractors share price were trading at a premium of ₹95 in the grey market, according to investorgain.com.

The expected listing price of SRM Contractors shares was indicated at ₹305 apiece, which is 45.24% more than the IPO price of ₹210, taking into account the upper end of the IPO pricing band and the present premium on the grey market.

Going forward, the IPO GMP anticipates a robust listing, based on the actions of the past nine sessions in the grey market. As to the analyst report on investorgain.com, the lowest GMP is 25 and the maximum is 95 rupees.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

SRM Contractors IPO Review 

Dilip Davda, the contributing editor at Chittorgarh

The company, according to Davda, has been exhibiting consistent development in both its top and bottom lines and is involved in specialised engineering construction for highways, tunnels, slop stabilisation, etc. As of December 2023, the firm has orders worth more than ₹1199 crore, suggesting its possibilities. The issue looks to be fully priced based on FY24 annualised profits. All other factors are in line, with the exception of the Lead Manager's dismal performance history. Investors may set aside money in anticipation of medium- to long-term gains.

Also Read: SRM Contractors IPO opens tomorrow: GMP, issue details, 10 key things to know before investing to ₹130 crore issue

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