IKIO Lighting IPO : Issue subscribed 1.55 times on Day 1 ; NII, retail portion overbooked

IKIO Lighting IPO Subscription Status: The initial public offering (IPO) of IKIO Lighting Ltd was subscribed 1.55 times on Day 1 at 17:00 IST, according to BSE data. The public issue that has opened for subscription on Tuesday, June 6, will close on Thursday, June 8.

On Day 1 of the subscription, the issue saw positive response from Non Institutional Investors (NIIs) who subscribed to the issue 2.97 times. Retail investors subscribed to 1.64 times of the portion reserved, and qualified institutional buyers portion was subscribed 30%.

The company has received bids for 2,36,67,020 shares against 1,52,24,074 shares on offer, according to data from the BSE at 17:00 IST.

The qualified institutional buyers' (QIBs) portion received bids for 12,81,644 shares against 42,42,592 on offer for this segment.

The retail investors' portion received bids for 1,26,16,136 shares against 76,87,037 shares on offer for this segment.

The non-institutional investors' portion received bids for 97,69,240 shares against 32,94,445 on offer for this segment.

The employees' portions did not receive any subscription.

The IKIO Lighting IPO, worth ₹607 crore, is made up of an offer for sale (OFS) of up to 90 lakh shares by the promoters and a fresh issuance for ₹350 crore.

The price band for the IPO has been set at ₹270 to ₹285 per share. Promoters Hardeep Singh and Sumeet Kaur will take part in the OFS by selling 60 lakh and 30 lakh equity shares, respectively.

As of June 5, IKIO Lighting has already received ₹182 crore from anchor investors. According to information posted on the BSE, the company allocated 63.84 lakh equity shares to a total of 16 funds at an issue price of ₹285 per share.

The majority of brokerages have given the IKIO Lighting IPO a 'Subscribe' rating for the long term because to its solid business model and reasonable prices.

According to Mehta Equities the IPO offer gives investors an opportunity to invest in one of the growing original design manufacturers (ODM), electronics manufacturing service providers (EMS) businesses, which is well-positioned to capitalise on opportunities provided by the tailwinds in the LED lighting market driven in part by governmental policies for energy saving and environment protection.

“On valuation parse at upper price band of ₹285-, the issue is asking for a market ap of ₹2203 crore. On annualised earnings and fully diluted post-IPO paid-up capital, IKIO is asking price a P/E of 32 times on the basis of proforma consolidated basis and 47 times based on consolidated restated numbers which seems the valuations are reasonably priced when compared to Industry average PE which is around about 55 times. Hence considering companies and industrial growth rationales, we recommend investors 'Subscribe' to IKIO Lighting IPO offer with a long term perspective. With market sentiments recovering if we get any listing gains over and above 25%, we recommend allotted investors to book profits,” said the brokerage.

Also Read: IKIO Lighting IPO: GMP, should you subscribe, other details as issue opens today

The majority of brokerages have given the IKIO Lighting IPO a 'Subscribe' rating for the long term because to its solid business model and reasonable prices.

According to Mehta Equities the IPO offer gives investors an opportunity to invest in one of the growing original design manufacturers (ODM), electronics manufacturing service providers (EMS) businesses, which is well-positioned to capitalise on opportunities provided by the tailwinds in the LED lighting market driven in part by governmental policies for energy saving and environment protection.

“On valuation parse at upper price band of ₹285-, the issue is asking for a market ap of ₹2203 crore. On annualised earnings and fully diluted post-IPO paid-up capital, IKIO is asking price a P/E of 32 times on the basis of proforma consolidated basis and 47 times based on consolidated restated numbers which seems the valuations are reasonably priced when compared to Industry average PE which is around about 55 times. Hence considering companies and industrial growth rationales, we recommend investors 'Subscribe' to IKIO Lighting IPO offer with a long term perspective. With market sentiments recovering if we get any listing gains over and above 25%, we recommend allotted investors to book profits,” said the brokerage.

Also Read: IKIO Lighting IPO: GMP, should you subscribe, other details as issue opens today