Hyderabad-based aerospace components and turbines manufacturer, Azad Engineering, is all set to launch its Initial Public Offering (IPO) today, December 20. The company seeks to raise ₹740 crore from the public issue, which is scheduled to conclude on December 22.
The Azad Engineering IPO has a total issue size of Rs 740.00 crore, comprising a fresh issue of 46 lakh equity shares amounting to Rs 240 crore and an Offer for Sale (OFS) of 95 lakh shares totaling Rs 500 crore.
Allocation for the IPO is structured with 50% of shares reserved for Qualified Institutional Buyers (QIBs), 35% for Retail Investors, and the remaining 15% earmarked for Non-Institutional Investors (NIIs).
Azad Engineering, a supplier to Original Equipment Manufacturers (OEMs) in aerospace, defense, energy, and oil and gas industries, specializes in highly engineered, complex, mission-critical products.
Market observers note a Grey Market Premium (GMP) of Rs 440 per share for Azad Engineering today, signifying an 83.97% premium over the issue price, trading at Rs 964 apiece in the grey market.
Axis Capital, ICICI Securities, SBI Capital Markets, and Anand Rathi Securities serve as the book running lead managers for the Azad Engineering IPO, with Kfin Technologies fulfilling the role of the IPO registrar.
Azad Engineering holds a dominant position in its specialized market, virtually enjoying a monopoly. The company has consistently demonstrated revenue growth during the reported periods. Although the Azad Engineering IPO issue is perceived as fully priced based on FY24 annualized earnings, analysts suggest that considering the company’s promising future, investors may find it favorable to subscribe to the issue for a medium to long-term investment horizon, believes market experts.
