- Advertisement -

Harsha Engineers IPO: Details about GMP, Allotment & Listing Date

- Advertisement -

Harsha Engineers International IPO received an oversubscription of 74.70 times on the final date of public sale.

The qualified institutional buyers (QIB) had the highest bid during the IPO followed by high-net-worth customers.

Investors from the retail sector also demonstrated high interest in the IPO. On Sunday, on the grey market, shares of the IPO trades at around Rs240.

The company is expected to complete the process of distributing shares to bidders in six working days following the closing date on the IPO.

Harsha Engineers IPO GMP

On the gray market it is known that the Harsha Engineers IPO has the GMP that is Rs240 for equity shares at present. Grey markets are where shares of a company are offered informally to traders.

With an GMP that is Rs240/share Harsha Engineers is expected to sell at a premium that is Rs570 per share (upper price band of Rs330 as well as Rs240 per shares GMP).

Harsha Engineers IPO allotment

In its prospectus that is red herring, Harsha Engineers stated that the “Company is required to complete allotment pursuant to the Offer within six working days from the Bid/Offer Closing Date.”

In any case, Harsha Engineers is expected to distribute shares to qualified buyers for the IPO on the 21st of September.

The company is expected to launch it’s marketplace debut on the 26th of September 2022. They will list it on the NSE in addition to BSE.

Harsha Engineers IPO

Harsha Engineers launched its initial public offering (IPO) to raise the sum of Rs.755 crore. On the third day, the IPO was oversubscribed by 74.70 times.

The QIB portion was oversubscribed by 178.26 times in comparison to those in the NII class (HNIs) was subscribed to in 71.32 times.

The portion reserved for investors who are retail individuals has been oversubscribed 17.63 times.

The IPO is priced with a range between Rs314 and Rs330 for each equity share.

Outlook for growth!

Harsha Engineers is the largest maker of high-precision bearing cages in terms of revenue, within the organized sector in India and is one of the most renowned makers of high-precision bearing cages around the globe.

Harsha Engineers offers a broad range of engineering products that are precision across different regions and industries of the end-user.

It holds between 50 and 60 percent market share of the organised market segment in the Indian market for bearing cages.

It also has 6.5 percent of market share in the worldwide organized market for steel, brass and polyamide cages for CY 2021.

In FY22, revenue was up by over Rs1,321.5 crore as compared to Rs873.7 million in FY21. It also reached Rs885.8 million in FY20.

PAT was increased by Rs91.9 million in FY22, compared to Rs45.4 million in FY21, and Rs21.9 crore for FY20. On the 31st of March, 2022 its EBITDA and PAT margins was 14.1 percent and 6.9 percent, respectively.

The IPO announcement, KR Choksey in its report said earlier it believed 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% in the Indian organized precision bearing cages market. The company has healthy return ratios and good earnings visibility going ahead.”

In the IPO document, Ventura Securities had said, “We are expecting HEIL’s revenue/ EBITDA/ PAT to grow at a CAGR of 17.2%/ 22.7%/ 32.1% to Rs2,125 cr/ Rs313 cr/ Rs212 cr respectively over FY22-25E,

while EBITDA and PAT margins are expected to improve by 191bps (to 14.7%) and 301bps (to 10.0%) respectively over the same period. Subsequently, RoIC is expected to improve by 586bps to 21.5% by FY25.”

In the note, Ventura Securities also explained a bear and bull scenario for the firm based on FY25’s revenues and estimates of PAT margins.

In the case of the bull, Ventura’s note reads, “We have assumed FY25 revenues of INR 2,400 crore (FY22-25 CAGR 22.0 percent) and a PAT percentage of 10.0%, and this would yield the Bull Case price target of Rs461 per share (an increase of 39.7 percent from IPO cost).

In the case of the bear the note stated “We have assumed FY25 revenues of INR 1,800 cr (FY22-25 CAGR of 10.9%) and PAT margin of 8.0%, which will result in a Bear Case price target of Rs277 per share (a downside of 16.1% from IPO price).”

On the stock exchanges Harsha Engineers will compete against listed companies like Timken India, SKF India, Rolex Rings and Sundaram Fasteners.

- Advertisement -


Please enter your comment!
Please enter your name here

- Advertisement -


- Advertisement -

More Articles