The issue was subscribed 1.17 times by 11.04 am on strong demand from non-institutional and retail investors.
The issue has attracted bids for 2,71,72,990 shares, or 1.17 times the issue size of 2,32,17,667 shares. The retail portion of the issue was subscribed 1.59 times, and the non-institutional category’s subscription rate stood at 1.75 times. There were no bids from qualified institutional buyers so far.
Analysts gave a thumbs-up to the issue as it offers a favourable risk-reward ratio for long-term investors, given its unique business model, decent return ratios and margins. According to market sources, the grey market premium (GMP) of Aeroflex Industries was Rs 66-68.
“We are confident that Aeroflex Industries will deliver consistent performance and provide an excellent investment opportunity for investors with a long-term horizon,” said Profitmart Securities.
The company, which is backed by marquee investors such as Ashish Kacholia and others, plans to raise Rs 351 crore at the upper price band of Rs 108.
Ahead of the issue opening, the company raised Rs 104 crore from anchor investors.Diversified anchor book of Aeroflex comprises 10 anchors including mutual funds, large insurance and NBFC treasuries, AIFs and a foreign portfolio institution.
Aeroflex Industries is a market leader in the field of metallic flexible flow solutions, offering a comprehensive range of products including corrugated stainless steel hoses and interlock flexible metal hoses.
“Aeroflex Industries has exhibited impressive financial growth and established strong client relationships, holding a dominant market position in India. With the support of seasoned promoters, prominent HNI investors, and a forward looking strategy, it is excellently poised for enduring success within the burgeoning flexible flow solutions sector,” said AUM Capital.
The IPO, with a face value of Rs 2 per equity, is priced in the range of Rs 102-108. The issue consists of a fresh equity of Rs 160 crore and an offer-for-sale (OFS) of up to 17.5 million equity shares by promoters selling shareholders.
About 50% of the offer is reserved for qualified institutional buyers, 15% for non-institutional investors and 35% of the offer is set aside for retail investors.
“In view of diversified product portfolio, strong financials, global footprint, focus on expanding its capacities, products and R&D capabilities, we recommend a Subscribe to the issue,” said Reliance Securities.
The proceeds from the issue will be utilised to the extent of Rs 35 crore for the prepayment of outstanding secured borrowings availed by the company, Rs 84 crore for funding its working capital requirements, and certain of the amount will be used for general corporate purposes and acquisitions for inorganic growth.
For the financial year ending March 2023, the company has clocked revenue from operations of Rs 269.4 crore and a profit of Rs 30.1 crore.
Pantomath Capital is the sole book-running lead manager to the IPO and Link Intime India is the registrar of the offer. The company’s equity shares are proposed to be listed on the BSE and NSE.
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