Shares of Ratnaveer Precision Engineering Ltd made a robust debut on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on Monday, listing at a premium of 25.7% and 30.6% respectively. The shares debuted at ₹128 ($1.74) on the BSE, compared to the issue price of ₹98 ($1.33). The shares then touched an intraday high of ₹138 ($1.87), around 40% higher from its issue price.
The initial public offering (IPO) of Ratnaveer Precision Engineering, which manufactures stainless steel finished sheets, washers, solar roofing hooks, pipes, and tubes, was open for subscription from Monday, September 4 to Wednesday, September 6. The IPO was fully subscribed 93.99 times on the last day of subscription thanks to overwhelming participation from institutional investors.
The Qualified Institutional Buyers (QIBs) category was subscribed 133.05 times, the portion for non-institutional investors received 135.21 times subscription and Retail Individual Investors (RIIs) quota got oversubscribed by 54 times. The IPO comprised a fresh issue of equity shares worth ₹135.24 crore ($18.3 million) and an Offer-For-Sale (OFS) with promoters offloading 3 million shares worth ₹29.79 crore ($4 million).
The IPO price band was fixed in the range between ₹93 to ₹98 per equity share of face value of ₹10 each. Prior to the IPO, Ratnaveer Precision Engineering raised about ₹49.5 crore ($6.7 million) from anchor investors on Friday, September 1.
The grey market premium for Ratnaveer Precision shares gained 52% on Monday, indicating investors' readiness to pay more than the issue price. The estimated listing price of Ratnaveer Precision share price was ₹150 ($2.03), which is 53.06% higher than the IPO price.
Ratnaveer Precision Engineering operates in a fragmented market dominated by small and medium-sized unorganized players. The company's top and bottom lines have been growing at a respectable rate, and it has reported an operating margin in the single digits. Choice Broking assigned a “Subscribe with Caution” rating for the issue, citing the company's growth outlook amid growing competition.
The net proceeds from the fresh issue will be utilised to fund working capital requirements of the company, and general corporate purposes. Unistone Capital Private Ltd is the book running lead manager of the offer, while Link Intime India Private Ltd is the offer's registrar.
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