Quadrant Future Tek IPO listing: Quadrant Future Tek shares made a strong debut on Tuesday, January 14, listing at ₹370 on NSE, a premium of 27.5 percent over the issue price of ₹290. Meanwhile, on BSE, it was listed at ₹374, up 29 percent.
Quadrant Future Tek's initial public offering (IPO), valued at ₹290 crore, was open for subscription from January 7 to January 9. The IPO price band was fixed at ₹275-290 per equity share.
Following the three days of bidding, Quadrant Future Tek IPO closed with exemplary demand, garnering 185.48 times bids. The IPO received bids for 380.27 crore shares against 2.05 crore shares on offer. The retail investor segment was booked 65.71 times, while the non-institutional investors (NII) category was subscribed 275.21 times. Meanwhile, the Qualified Institutional Buyers quota was bid 327.76 times on the 3 days of bidding.
Quadrant Future Tek IPO was entirely a fresh issue of 1 crore shares with no offer for sale component. Retail investors could apply with a minimum lot size of 50 shares, requiring a minimum investment of ₹14,500.
Quadrant Future Tek IPO raised ₹130.50 crore from anchor investors ahead of the IPO on January 6, 2024.
The company plans to allocate the net proceeds from the issue towards several key objectives. These include funding its long-term working capital requirements to support ongoing operations, making capital expenditures for the development of an advanced Electronic Interlocking System, and prepaying or repaying a portion of its outstanding working capital term loans. Additionally, a part of the proceeds will be utilized for general corporate purposes, ensuring financial flexibility for the company's strategic initiatives.
Sundae Capital Advisors is the book running lead manager of the Quadrant Future Tek IPO, while Link Intime India Private Ltd is the registrar for the issue.
Brokerages have shown confidence in the IPO, assigning it a 'subscribe' rating based on its strong growth potential and attractive valuation metrics. Analysts believe the issue offers significant long-term investment opportunities, enhancing its appeal to investors.
SBI Securities has recommended a 'subscribe' rating, emphasizing the promising growth outlook for the Indian Specialty Cable and Train Control System sectors. Analysts noted key strengths such as the strategic memorandum of understanding (MoU) with RailTel Corporation for the KAVACH system and the ₹978.6 crore order from Chittaranjan Locomotive Works, which reinforce the company's standing as a leading original equipment manufacturer (OEM). Although the IPO is priced at a post-issue FY24 P/E multiple of 79.0x at the upper price band, the significant growth potential and strategic advancements make it an attractive proposition for investors.
Ventura Securities also assigned a 'subscribe' rating, citing the rising demand for automated railway safety systems under the 'Make in India' initiative and the increasing use of e-beam cables in renewable energy and electric vehicle (EV) applications as critical growth drivers. The brokerage praised the company's innovative solutions, strong financial performance, and focus on quality, stating that Quadrant is well-positioned for sustained growth and represents a compelling investment opportunity.
Quadrant Future Tek Limited, established in September 2015, specializes in developing next-generation Train Control and Signaling Systems for the Indian Railways' KAVACH project, aimed at improving passenger safety and system reliability. Additionally, the company operates a specialty cable manufacturing facility equipped with an Electron Beam Irradiation Centre.
The company’s manufacturing, testing, and development facility for specialty cables and hardware, dedicated to its Train Control and Signaling Division, is located in Village Basma, Tehsil Banur, District Mohali.
As a technology-driven enterprise, Quadrant Future Tek Limited ensures its products comply with ISO, IRIS, and TS standards, adhering to stringent Quality Management Systems for specialty cables. Financially, the company reported a 1 percent decline in revenue but achieved a 6 percent increase in profit after tax (PAT) between the fiscal years ending March 31, 2024, and March 31, 2023.
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