The initial public offering (IPO) of Harsha Engineers International Ltd has decided to set a price band of Rs 314-330 per share for its initial public issue, opening from September 14 to 16. Per market experts, the present grey market premium for the IPO stances at Rs 140-150 a share. On September 23, shares will be credited to investors’ De-mat accounts, thus making its market debut on September 16.

The IPO contains a fresh issue of Rs 455 crore and an Offer-for-Sale of up to Rs 300 crore by promoters and shareholders. A total of Rs 270 crore from the fresh issue will be for debt paying, Rs 77.95 crore for machinery purchase, and Rs 7.12 crore for infrastructure repairs, renovation of the existing facilities, and general corporate proposes. This is the Ahmedabad-based Company’s second attempt to go public. It had filed draft papers with the regulator in August 2018. The lead Managers to issues are Axis Capital, Equirus Capital, and JM Financial.

DRHP stated that Harish Rangwala founded Rajendra Shah Harsha engineering in 1986. 99.7 promoters hold per cent of the company’s equity. Harsha engineering offers a diverse suite of precision engineering products across the globe and end-user industries, including automotive, construction, railways, aviation and renewable energy, aerospace mining, agriculture, and other industrial sectors. Currently, the company has five manufacturing units, three in Gujarat and one in china and Romania.

50 per cent of the market shares are claimed to be held by Harsha Engineers in an organized segment of the Indian bearing cages and globally 5.2 per cent market share bearing cages for brass, steel, and polyamide cages in CY20
On revenue of Rs 1321.48 crore in the year ended March 2022, the company recorded a profit of Rs 91.94 crore, more than the previous year’s revenue profit of 45.44 crores on a revenue of Rs 873.75 crore. In the year-ago period, net debt for the company was Rs 322.08 crore. Currently, the net debt has risen to Rs 356.59 crore.

Manan Doshi, CO-Founder of Unlisted Arena.com, stated that the company’s top and bottom line growth looks impressive. The public offer looks reasonably priced at a post-issue P/E ratio of around 32.70x based on FY 22 earnings. The primary and broader market sentiment is positive, which would help the issue garner a good response; the company is expecting an overwhelming response to the IPO on account of reasonable valuation, advantageous market conditions, and positive listings.

Three IPOs recently this month got a good response from investors. Airport service aggregator DreamFolks Services IPO was subscribed 56.68 times, Syrma SGS Technology, which listed exchanges on August 25, was subscribed nearly 35 times, and Tamilnad Mercantile Bank got 2.86 times subscription.