Syrma SGS Technology IPO: Latest GMP, subscription status on day 2 of the issue
- Syrma SGS Tech's IPO includes a fresh issue of ₹766 crore and OFS of up to 3.37 million shares
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Business News/ Markets / Ipo/ Syrma SGS Technology IPO: Latest GMP, subscription status on day 2 of the issue
Syrma SGS Technology's initial public offering (IPO), with a price band of ₹209-220 a share, is open for public subscription from August 12 and will conclude on August 18, 2022. At the upper end of the price band, the initial share-sale is expected to fetch ₹840 crore.
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Syrma SGS Tech's IPO includes a fresh issue of ₹766 crore and an offer for sale (OFS) of up to 3.37 million shares by promoter Veena Kumari Tandon. It is the first company to tap the primary market in two-and-a-half months.
As of 3:20 pm on day 2 of the bidding, the issue has been subscribed 0.83 times with retail investors booked 1.45 times and NIIs 0.59 times, showed the BSE data.
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As per market observers, Syrma SGS Technology shares are available at a premium (GMP) of ₹30 in the grey market today. The company's shares are expected to list on stock exchanges BSE and NSE on Friday, August 26, 2022.
"Considering its good peer financial performance, strong focus on R&D, capacity expansion plans, positive industry outlook with government support through PLI schemes and China plus one strategy of multinational companies, we assign a “Subscribe" rating for the issue on a medium to long term basis," said brokerage Geojit Financial.
The company aims to use the net proceeds from the fresh share issue for funding capital expenditure requirements to expand manufacturing and R&D facilities and to fund long-term working capital requirements.
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"At higher price band, the IPO is valued at 24.1% discount to the pre-IPO placement price, which may be considered favorable by the retail investors. But the company has demanded an EV/Sales multiple of 2.5x (to its FY22 proforma consolidated sales), which is at premium to the peer average. Thus, the issue seems to be fully priced. Considering the high growth potential in the electronic manufacturing sector, we are recommending a “Subscribe with Caution" rating for the issue," said Choice Broking.
The electronic manufacturing services firm Syrma SGS Technology on Thursday said it has raised ₹252 crore from anchor investors ahead of its initial share-sale.
Syrma SGS is a technology-focused engineering and design company engaged in turnkey electronics manufacturing services (EMS) that specialises in precision manufacturing.
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