INDO SMC's initial public offering opened for public subscription on January 13, 2025, marking the company's entry into the capital markets through the BSE SME platform. The issue has generated decent buying interest from investors, while grey market indicators suggest strong listing potential for the power equipment manufacturer.

Anchor Investment and Grey Market Performance

Prior to the public issue, INDO SMC successfully raised ₹26.20 crore from anchor investors through the allocation of 17.56 lakh shares at ₹149 per share. This anchor investment demonstrates institutional confidence in the company's prospects.

The grey market premium for INDO SMC shares stood at ₹36 on Tuesday, indicating potential listing gains of 24.2% at ₹185 on the BSE SME platform.

Subscription Status and Issue Details

By 10:35 am on Tuesday, the SME IPO recorded an overall subscription of 0.15 times. The retail portion was booked 0.21 times, while the segment reserved for non-institutional investors achieved 0.17 times subscription. The qualified institutional buyers portion had not received any subscriptions at that time.

Allocation and Key Dates

The issue allocation favors institutional investors, with qualified institutional buyers receiving the largest portion at 29.28 lakh shares (47.45% of the net issue). Retail investors have been allocated 20.52 lakh shares (33.25%), while non-institutional investors receive 8.82 lakh shares (14.29%). The minimum and maximum bid size for retail investors is set at 2,000 shares.

Business Overview and Financial Performance

INDO SMC operates in the power equipment sector, specializing in the design and manufacturing of enclosure boxes for energy meters, high tension current and potential transformers, distribution boxes and panels, fiberglass reinforced plastic grating, junction boxes, and feeder pillars for power distribution and circuit protection applications.

The company has demonstrated remarkable financial growth across recent fiscal years:

Use of Proceeds and Market Intermediaries

According to the Red Herring Prospectus, the company plans to utilize the net proceeds for purchasing plant and machinery, meeting working capital requirements, and general corporate purposes. GYR Capital Advisors Private Limited serves as the book-running lead manager, while KFIN Technologies Limited acts as the registrar for the issue.

INDO SMC Limited's ₹91.95 crore initial public offering opens for subscription on January 14, 2025, with early market indicators suggesting strong investor interest. The book-built SME IPO is commanding a grey market premium of approximately 24%, signaling positive sentiment ahead of its proposed listing on the BSE SME platform on January 21. The subscription window will remain open until January 16.

Issue Structure and Pricing Details

The IPO comprises entirely fresh equity shares, with the company issuing 61.71 lakh shares to raise ₹91.95 crore. The pricing has been set in a band of ₹141 to ₹149 per share, valuing the company at approximately ₹340.5 crore at the upper price band.

The minimum application requirements vary by investor category. Retail investors must bid for at least 2,000 shares, requiring an investment of ₹2.98 lakh at the upper price band. High net-worth individuals face a minimum application size of 3,000 shares, translating to ₹4.47 lakh.

Allocation Framework

The issue follows a structured allocation pattern across different investor categories. Qualified institutional buyers, including anchor investors, have been allocated 47.45% of the total issue size. Retail investors receive 33.25% allocation, while non-institutional investors get 14.29%. Additionally, 5% of the issue has been reserved for market makers.

Business Operations and Manufacturing

INDO SMC operates in the electrical equipment manufacturing sector, specializing in products for electrical, industrial and infrastructure applications. The company's product portfolio encompasses enclosure boxes for energy meters, current and potential transformers, distribution boxes and panels, FRP gratings, feeder pillars and power distribution switchgears.

The company maintains four manufacturing facilities strategically located across Gujarat, Maharashtra and Rajasthan. Its Ahmedabad facility focuses specifically on SMC and FRP products. The company has established in-house testing laboratories to ensure quality control and compliance with technical standards.

Financial Performance

INDO SMC has demonstrated strong financial growth in recent periods. The company's financial metrics show consistent performance across key parameters.

Fund Utilization Strategy

The company has outlined a clear deployment strategy for the IPO proceeds. Capital expenditure for plant and machinery will receive ₹25.7 crore, supporting the company's expansion plans. The largest allocation of ₹52 crore will address working capital requirements, reflecting the execution-intensive nature of the business. The remaining funds will be directed toward general corporate purposes.

Issue Management

GYR Capital Advisors serves as the book-running lead manager for the issue, while KFin Technologies has been appointed as the registrar. Giriraj Stock Broking and Nikunj Stock Brokers are functioning as market makers for the IPO.