Airfloa Rail Technology IPO: Strong Debut with 20.69x Subscription on Day 1

Subscription Details

The IPO witnessed an impressive overall subscription of 20.69 times on its opening day, indicating robust demand from investors. Here's a breakdown of the subscription rates across different investor categories:

• Retail Investors: Led the charge with a subscription rate of 34.17 times their allocated quota.
• Non-Institutional Investors: Showed strong interest with a 17.81 times subscription of their allocation.
• Qualified Institutional Buyers (QIBs): As of the first day, no bids were reported from this category.

IPO Specifics

Grey Market Premium

The grey market is showing significant enthusiasm for Airfloa Rail Technology shares:

• Grey Market Premium: 118.50% over the issue price.
• Potential Listing Price: Based on the grey market premium, the shares could potentially list around ₹306.00.

Company Financials

Airfloa Rail Technology has reported strong financial performance:

About the Company

Airfloa Rail Technology specializes in manufacturing railway components for Indian Railways. The strong investor interest in the IPO could be attributed to the company's focused business model and the growing importance of railway infrastructure in India.

The enthusiastic response to the IPO, particularly from retail and non-institutional investors, suggests a positive sentiment towards the company's business prospects. However, it's worth noting that the absence of bids from qualified institutional buyers on the first day is an aspect to watch as the subscription window progresses.

Investors and market observers will be keenly watching the subscription trends over the next few days, leading up to the tentative listing date of September 18.

Airfloa Rail Technology, a key supplier to Indian Railways, has launched its Initial Public Offering (IPO) on the BSE SME platform, aiming to raise Rs 91 crore. The IPO, which opened for subscription on September 11, is set to close on September 15, with the listing scheduled for September 18.

IPO Details

The fresh issue comprises 65.1 lakh shares priced in the band of Rs 133-140 per share. At the upper price band, the company is valued at a post-issue market capitalization of Rs 335.60 crore. Notably, the IPO has garnered significant interest in the grey market, commanding a premium of 120%. This suggests that shares may potentially list above Rs 300, compared to the upper price band of Rs 140.

Fund Utilization

The proceeds from the IPO are earmarked for several key purposes:

• Capital expenditure: Rs 13.70 crore
• Debt repayment: Rs 6.00 crore
• Working capital: Rs 59.30 crore
• General corporate purposes: Remaining amount

Company Profile

Airfloa Rail Technology, incorporated in 1998, specializes in manufacturing rolling stock components and interior projects for Indian Railways, as well as the aerospace and defense sectors. The company's product portfolio includes components for high-profile projects such as the Vande Bharat Express, RRTS (Regional Rapid Transit System), and Agra-Kanpur Metro.

Financial Performance

The company has demonstrated strong financial growth:

All figures in Rs crore

IPO Management

GYR Capital Advisors is serving as the book-running lead manager for the IPO, while Kfin Technologies has been appointed as the registrar.

The strong grey market premium indicates high investor interest in Airfloa Rail Technology's public offering. However, it's important to note that grey market premiums are unofficial and subject to change. Investors are advised to make decisions based on the company's fundamentals and their own research.