Sachin Tendulkar-backed Azad Engineering IPO subscribed over 80 times
Cricket legend Sachin Tendulkar-backed Azad Engineering's Rs. 740 crore IPO is seeing a strong response on the final day of bidding. The issue has been subscribed over 80 times. Investors from various categories placed bids for nearly 81.58 crore equity shares, compared to the 1.01 crore shares offered. Other prominent sports personalities, including PV Sindhu, Saina Nehwal and VVS Laxman also have stakes in the company. None of them are offloading shares in the IPO.
Subscription breakdown and IPO details
Leading the subscription were qualified institutional buyers, who subscribed 179.66 times their allotted quota. High networth individuals (non-institutional investors) followed at 87.55 times, and retail investors at 23.71 times their respective portions. Employees, who had a reservation for Rs. 4 crore worth of shares, bid 14.69 times the reserved portion.
How will the funds be utilized?
Azad Engineering intends to use the net fresh issue proceeds for purchasing plant and machinery at a cost of Rs. 60.4 crore, repaying debts totaling Rs. 138.19 crore, and for general corporate purposes. Incorporated in 1983, Azad Engineering Limited is a manufacturer of aerospace components and turbines. The company supplies its products to original equipment manufacturers (OEMs) in the aerospace, defense, energy, and oil and gas industries. Azad Engineering's products are highly engineered, complex, mission-critical, and vital.
IPO details
The price band of the issue was fixed between Rs. 499 to Rs. 524 per share. The IPO includes a fresh issuance of shares worth Rs. 240 crore and an offer-for-sale (OFS) of shares worth Rs. 500 crore. The company plans to finalize the basis of allotment by December 26 and credit equity shares to successful investors' demat accounts by December 27. Trading in Azad Engineering shares on the stock exchanges is set to begin on December 28.
What is the current GMP?
In the grey market, Azad Engineering shares traded with a premium of around 70% over the upper price band, according to investorgain.com. Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Azad Engineering share price is Rs. 899 apiece, which is 71.56% higher than the IPO price of Rs. 524.
