Harsha Engineers IPO GMP today: Following Harsha Engineers International’s IPO share allocation, all eyes are now on the IPO. The Ahmedabad-based company’s first share sale was subscribed 74.70 times, helped by strong demand from institutional buyers, on the last day of subscription (September 16). The tender offer received bids for 125.96 crore shares against 1.68 crore shares being tendered, BSE data showed.
Harsha Engineers IPO: Subscription Status
The portion for qualified institutional buyers was subscribed 178.26 times, while the portion for non-institutional investors was subscribed 71.32 times. The share of private investors was subscribed 17.63 times.
Harsha Engineers IPO: About the issue
The lot size of Harsha Engineers IPO was 45 shares for which one would have to spend Rs 14,850. A private retail investor can submit bids for up to 13 lots or 585 shares by spending Rs 1,93,050. Axis Capital Limited, Equirus Capital Private Limited and JM Financial Consultants were the lead managers of the IPO.
The company’s operating income increased by 51.24 percent to Rs 1,321.48 crore for fiscal 2022, from Rs 873.75 crore for fiscal 2021, while its after-tax profit doubled to Rs 91.94 crore for fiscal 2022, from Rs 45 .44 crore for fiscal 2021.
Harsha Engineers IPO: Listing Date
Shares of the company are likely to be listed on the stock exchanges on September 26. It will be listed on both NSE and BSE.
Harsha Engineers IPO GMP today
Meanwhile, the gray market has turned bullish for Harsha Engineers stock. According to market observers, Harsha Engineers’ IPO GMP (Grey Market Premium) today is Rs 240, which is Rs 45 above yesterday’s low of Rs 195. Market observers claimed that this increase in the Harsha Engineers IPO gray market premium is mainly due to the trend reversal in the secondary market sentiments.
A gray market is where a company’s stock is unofficially offered to traders. With a GMP of Rs 240 per share, Harsha Engineers is expected to quote a premium of Rs 570 per share (upper price range of Rs 330 each plus Rs 240 per share GMP).
Harsha Engineers IPO: About the Company
Harsha Engineers is the largest precision bearing cage manufacturer, in terms of sales, in the organized sector in India, and one of the leading precision bearing cage manufacturers in the world. The company offers a diversified range of precision engineering products in different geographies and end-user sectors.
In his IPO note, KR Choksey previously stated in his report: “We believe the company’s long-term prospects are favorable given its long-standing relationship with key industry players. The company has a healthy 50-60 percent share of the Indian precision bearing cage market. The company has healthy return ratios and a good view of earnings.”
Furthermore, Ventura Securities had said in its IPO note: “We expect HEIL’s revenue/EBITDA/PAT to grow at a CAGR of 17.2 percent/22.7 percent/32.1 percent to Rs 2,125 cr/ Rs 313 cr/ Rs 212 cr versus FY22-25E, respectively, while EBITDA and PAT margins are expected to improve by 191 bp (to 14.7 percent) and 301 bp (to 10.0 percent) respectively over the same period. Subsequently, the RoIC is expected to improve by 586 bps to 21.5 percent in FY25.”
In its note, Ventura Securities also explained a bull-and-beer scenario for the company based on the company’s FY25 earnings and PAT margin estimates.
In the bull case, Ventura’s note said: “We have assumed FY25 revenue of INR 2,400 cr (FY22-25 CAGR of 22.0 percent) and a PAT margin of 10 percent, which will result in a Bull Case price target of Rs 461 per share (up 39.7 percent from the IPO price).
In the case of the bears, the note said: “We have assumed FY25 sales of INR 1,800 cr (FY22-25 CAGR of 10.9 percent) and a PAT margin of 8.0 percent, which will result in a Bear Case price target of Rs 277 per annum share (down 16.1 percent from the IPO price).”
At trade shows, Harsha Engineers will compete against publicly traded companies such as Timken India, SKF India, Rolex Rings and Sundaram Fasteners.
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