Harsha Engineers IPO GMP Today: After the share allotment of Harsha Engineers International’s initial public offering (IPO), all eyes are now on the stock market listing. The initial share sale of the Ahmedabad-based company got subscribed 74.70 times, helped by heavy demand from institutional buyers, on the last day of subscription (September 16). The public offer received bids for 125.96 crore shares against 1.68 crore shares on offer, BSE data showed.
Harsha Engineers IPO: Subscription Status
The qualified institutional buyer portion was subscribed 178.26 times, while the portion reserved for non-institutional investors witnessed a subscription of 71.32 times. The retail investors’ portion 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 retail individual investor could 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 revenue from operations increased by 51.24 per cent to Rs 1,321.48 crore for fiscal 2022, from Rs 873.75 crore for fiscal 2021, while profit after tax 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 exchanges on September 26. It will be listed on both NSE and BSE.
Harsha Engineers IPO GMP today
Meanwhile, grey market has gone bullish on Harsha Engineers shares. According to market observers, Harsha Engineers IPO GMP (grey market premium) today is Rs 240, which is Rs 45 higher from its yesterday’s low of Rs 195. Market observers maintained that this rise in Harsha Engineers IPO grey market premium is mainly due to the trend reversal in the secondary market sentiments.
A grey market is where a company’s shares are offered unofficially to traders. With a GMP of Rs 240 per share, Harsha Engineers is expected to list at a premium of Rs 570 per share (upper price band of Rs 330 apiece plus Rs 240 per share GMP).
Harsha Engineers IPO: About the Company
Harsha Engineers is the largest manufacturer of precision bearing cages, in terms of revenue, in organised sector in India, and among the leading manufacturers of precision bearing cages in the world. The company offers diversified suite of precision engineering products across geographies and end-user industries.
In its IPO note, KR Choksey in its report stated earlier that “We believe the company’s long-term prospects are favorable, given long-standing relationship with key industry players. The company enjoys a healthy market share of 50-60 per cent in the Indian organized precision bearing cages market. The company has healthy return ratios and good earnings visibility going ahead.”
Further, in its IPO note, Ventura Securities had said, “We are expecting HEIL’s revenue/ EBITDA/ PAT to grow at a CAGR of 17.2 per cent/ 22.7 per cent/ 32.1 per cent to Rs 2,125 cr/ Rs 313 cr/ Rs 212 cr respectively over FY22-25E, while EBITDA and PAT margins are expected to improve by 191bps (to 14.7 per cent) and 301bps (to 10.0 per cent) respectively over the same period. Subsequently, RoIC is expected to improve by 586bps to 21.5 per cent by FY25.”
In its note, Ventura Securities also explained a bull and bear case scenario for the company based on the company’s FY25 revenues and PAT margins estimates.
In the bull case, Ventura’s note said, “We have assumed FY25 revenues of INR 2,400 cr (FY22-25 CAGR of 22.0 per cent) and PAT margin of 10 per cent, which will result in a Bull Case price target of Rs 461 per share (an upside of 39.7 per cent from IPO price).
In the bear case, the note said, “We have assumed FY25 revenues of INR 1,800 cr (FY22-25 CAGR of 10.9 per cent) and PAT margin of 8.0 per cent, which will result in a Bear Case price target of Rs 277 per share (a downside of 16.1 per cent from IPO price).”
On stock exchanges, Harsha Engineers will compete against listed firms like Timken India, SKF India, Rolex Rings, and Sundaram Fasteners.
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