Indo Farm Equipment IPO to debut on Indian markets today
The shares of Indo Farm Equipment IPO will debut on the exchanges on Tuesday. Ahead of the listing, the company’s shares are trading with a GMP of Rs 78 in the grey market.
Considering the upper price band of Rs 215, the stock is expected to see a listing premium of 35% over the issue price.
However, it is important to note that grey market premiums are just an indicator as to how the company’s shares are stacked up in the unlisted market and are subject to change rapidly.
Despite the offer being slightly on the expensive side, Indo Farm Equipment received overwhelming response from sets of investors especially NII category who bid for more than 500x to the category allotment, while the retail investors’ portion saw an impressive 104 times subscription.
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On an overall basis, the issue was oversubscribed by 227.67 times, making it the second highest subscribed IPO among the mainboard issues launched in 2024.
Analysts believe the massive demand was on the back ipo proceeds spent to strengthen its dealer network which can eventually lead to higher tractor sales in future.
On the other hand, the company is in expansion mode for its pick and carry cranes capacities to meet rising demands followed by a strong backward integration business model, helping it to enjoy high EBITDA margin when compared to its peers and assuming bright prospects for growth in agriculture segment as well as cranes segments.
“We recommend conservative allotted investors can think of booking profits above our expectations. While long term investors should consider to hold for long term despite knowing short term volatility post listing & risk in the markets. For non-allotted investors, we advise to accumulate if we get dips post listing due to profit booking attempts,” said Prashanth Tapse of Mehta Equities.
Indo Farm Equipment is a more than two decade-old fully integrated established manufacturer of tractors and pick and carry cranes, with ancillary manufacturing of other farm equipment.
The company currently manufactures Tractors ranging from 16 HP to 110 HP and Pick & Carry Cranes ranging from 9 tons to 30 tons. It had an annual capacity to manufacture 12,000 tractors and 1,280 Pick & Carry Cranes, as on September 30, 2024.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.