ASK Automotive, a leading manufacturer in India's two-wheeler advanced braking systems sector, has seen strong investor interest in its initial public offering (IPO) that started on November 7, 2023. The IPO, which is set to close on November 9, 2023, was subscribed at 92% on day two of the offering.
The company's IPO opened with a subscription of 38% on the first day. The interest from retail investors stood at 56%, while non-institutional investors (NII) showed a subscription rate of 41%. However, Qualified Institutional Buyers (QIB) demonstrated lower interest with a subscription rate of only 3%.
The IPO price band is ₹268-₹282 per share, aiming to raise ₹834 crore through an offer for sale (OFS) of up to 2.95 crore equity shares. The proceeds from the IPO will benefit the selling shareholders – promoters Kuldip Singh Rathee and Vijay Rathee – reducing their post-IPO shareholding to about 85%.
Before the start of the issue, ASK Automotive secured ₹250.2 crore from 25 anchor investors. The company has enlisted JM Financial Limited, Axis Capital (NYSE:AXS), ICICI Securities, and IIFL Securities as managers for the issue, with Link Intime India acting as the registrar.
ASK Automotive holds a significant market share in brake-shoe and advanced braking (AB) systems for two-wheelers in India. In fiscal year 2023, the company reported a revenue growth of 27%, reaching ₹2,555 crore. Its profit after tax (PAT) stood at ₹123 crore for FY23, with an improved PAT margin of 4.79 percent.
The company's operations span across fifteen manufacturing facilities across five states in India. It supplies to all top six two-wheeler original equipment manufacturers (OEMs) and electric vehicle OEMs, including TVS Motor Company Limited and Ather Energy Private Limited, among others.
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