Ajax Engineering shares likely to list flat next week amid weak markets; analysts weigh on buy, sell or hold strategy

Ajax Engineering shares will be listed on NSE, BSE next week.

Ajax Engineering shares are likely to see a flat listing on the stock exchanges next week, as per analysts, amid subdued market conditions.

The initial public offering (IPO) of the Bengaluru-based concrete equipment manufacturer Ajax Engineering was fully subscribed on the final day of bidding on February 12, garnering an overall subscription of 6.45 times. The Rs 1,269-crore issue, backed by private equity firm Kedaara Capital, was priced in the range of Rs 599-629 per share. Earlier, the company raised Rs 379 crore from anchor investors.

Narendra Solanki, Head of Fundamental Research- Investment Services at Anand Rathi Wealth, said, "Given the current market scenario, we expect Ajax Engineering to have a flat listing. However, with the growing infrastructure development in India and rising demand for automated concrete solutions, the company is well-positioned to benefit from industry tailwinds."

He added that Ajax Engineering's leadership in the self-loading concrete mixer (SLCM) segment, presence across the entire concrete application value chain, and stable financial performance make it a strong long-term investment. "We have assigned a 'subscribe for the long term' rating and advise investors to stay invested post-listing," Solanki said.

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Prashanth Tapse, Senior Vice President of Research at Mehta Equities, echoed similar views, stating that the stock may see a muted listing at its issue price. "At a market capitalisation of Rs 7,196 crore and a price-to-earnings (PE) ratio of around 29x, the valuation appears reasonable for the industry it operates in. The company holds a near-monopoly in the SLCM segment and stands to gain from the country’s infrastructure growth. Hence, we recommend a 'hold' rating for long-term investors," he said.

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Meanwhile, Palak Devadiga, Research Analyst at StoxBox, projected a marginal premium listing of about 2 percent above the issue price. "With its strong financials, favourable industry growth drivers, and reasonable valuation, Ajax Engineering presents an investment opportunity from a medium to long-term perspective," she said.

The company’s IPO was entirely an offer-for-sale (OFS) of 2.01 crore shares, amounting to Rs 1,269 crore at the upper price band, with promoters and investor shareholders offloading their stakes.

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