Midwest IPO Nears Closure with Strong Subscription, Mixed Analyst Outlook
Midwest's Rs 451 crore IPO is in its final day of bidding with an overall subscription of 11.73 times. Non-Institutional Investors lead with 33.20 times subscription, followed by Retail at 8.19 times and QIBs at 1.84 times. The IPO includes a fresh issue of Rs 250 crore and an offer for sale of Rs 201 crore, priced at Rs 1,065 per share. Grey market premium indicates a potential 12.7% listing gain. Midwest, operating in granite mining across 16 mines and exporting to 17 countries, reported Rs 643 crore revenue and Rs 133 crore profit, with 7% and 33% YoY growth respectively. Analyst ratings are mixed, with SBI Securities rating it NEUTRAL due to premium valuation, while BP Equities recommends SUBSCRIBE based on fundamentals and growth prospects.
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Midwest's Initial Public Offering (IPO) is approaching its final hours with robust investor interest, despite mixed analyst ratings. The Rs 451 crore IPO has garnered significant attention, particularly from non-institutional investors, as it enters its last day of bidding.
Subscription Details
The overall subscription status of the Midwest IPO stands at 11.73 times by the end of the second day. Here's a breakdown of the subscription rates across different investor categories:
| Investor Category | Subscription Rate |
|---|---|
| Non-Institutional Investors | 33.20 |
| Retail Individual Investors | 8.19 |
| Qualified Institutional Buyers | 1.84 |
IPO Structure and Pricing
The Midwest IPO comprises a fresh issue of Rs 250 crore and an offer for sale of Rs 201 crore. The issue price is set at Rs 1,065 per share. The grey market premium suggests a potential listing price of around Rs 1,200, indicating a premium of 12.7% over the issue price.
Company Overview
Midwest operates in the granite mining and processing sector, with a presence across 16 mines in Telangana and Andhra Pradesh. The company has established an international footprint, exporting to 17 countries.
Financial Performance
Midwest reported the following financial metrics:
| Financial Metric | Amount (in crores) | YoY Growth |
|---|---|---|
| Revenue | 643.00 | 7.00% |
| Profit After Tax | 133.00 | 33.00% |
Analyst Ratings
The IPO has received mixed ratings from analysts:
- SBI Securities: Assigned a NEUTRAL rating, citing premium valuation at 35.8x P/E.
- BP Equities: Gave a SUBSCRIBE rating, based on strong fundamentals and growth prospects.
Key Dates
- Share Allotment: Scheduled for October 20
- Listing Date: October 24
Closing Thoughts
As the Midwest IPO enters its final day, investors should consider the strong subscription rates, particularly from non-institutional investors, balanced against the mixed analyst ratings. The company's established presence in granite mining and processing, along with its export capabilities, presents an interesting proposition. However, potential investors should also weigh the premium valuation highlighted by some analysts against the company's growth prospects before making their investment decisions.
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