The public may now subscribe for shares in the first public offering (IPO) of Harsha Engineers International Ltd. (HEIL), which will end on September 17, 2022. For its inaugural share sale, the price range has been set at ₹314-330 rupees per share.
The Harsha Engineers initial public offering (IPO) comprises of a new issue of equity shares totaling ₹455 crore and an offer-for-sale (OFS) by existing shareholders of up to ₹300 crore.
The fresh issue’s proceeds will be used to pay off debt, support working capital needs for machinery purchases, infrastructure repairs, manufacturing facility renovations, and other general company plans.
According to market watchers, shares of Harsha Engineers are currently trading on the black market for a premium (GMP) of ₹210 rupees. On Monday, September 26, 2022, the company’s shares are anticipated to list on the top stock exchanges BSE and NSE.
“With its leading position, Harsha Engineers is ideally positioned to meet the expanding demand for bearing cages across sectors. We appreciate its rising attention to additional specialised precision components as well as the expanding EV market, both of which might increase its EBITDA margins. Its value, which is comparable to that of its listed peers, is 32.7x FY22 P/E. We anticipate that the IPO will be successful given the resurgence in auto/auto ancillary growth and the strong momentum in the midcaps. In an IPO letter, Motilal Oswal advised investors to subscribe for listing profits.
With a market share of between 50% and 60% in the organised market, Harsha Engineers International Ltd. is the biggest producer of precision bearing cages. It provides a broad range of precision engineering products for various end-user industries and geographical markets. The engineering business and the solar EPC business are the two business divisions that it works under.
The post-issue P/E works out to 32.7x FY22 EPS in terms of values (at the upper end of the issue price band). On the strength of margin improvement, the company’s consolidated PAT increased at a CAGR of almost 105% over FY20-22. We think that HEIL’s great competence and wide range of products should be taken into account when determining the valuations the firm commands. As a result, we have given the issue a SUBSCRIBE rating, according to brokerage Angel One.