ASK Automotive stock closes 10% up after listing at 8% premium to IPO price

Tech Mahindra Ltd: Shares of the IT major rose over 3 percent to Rs 1,171, a day after the stock fell almost a percent. As many as 14 lakh shares changed hands as against yesteray's 4 alkh shares n the bourses.

ASK Automotive stock closed 10 percent up after listing at an 8 percent premium to the IPO price on November 15. The stock opened at Rs 303.3 on NSE and closed at Rs 309.9. On BSE, stock started trading at Rs 304.9 and settled at Rs 310.2 against the issue price of Rs 282.

Ahead of the listing, the stock was trading at a 9 percent premium in the grey market, which is an unofficial ecosystem where shares start trading before the allotment in the IPO and until the listing day. Most investors track the grey market premium (GMP) to get an idea of the listing price.

The offer received a good response from investors with the issue getting booked 51.14 times and receiving bids for 105.85 crore shares against the issue size of 2.06 crore shares. Retail investors bid 5.7 times and non-institutional investors (NII) 35.47 times the portions set aside for them. QIBs picked 142.41 times their allotted quota. The promoters of the company are Kuldip Singh Rathee and Vijay Rathee.

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The price band for the IPO, which opened on November 7 and closed on November 9, was fixed at Rs 268-282 per share. The company raised Rs 834 crore via the public issue. Since the offer was entirely an offer-for-sale of 2.95 crore shares, the entire issue proceeds will go to the selling shareholders and the company will not get any money from the offer.

The company recorded a year-on-year revenue growth of 27 percent in FY23, reaching Rs 2,555 crore. The company's profit after tax jumped 48.8 percent to Rs 123 crore in FY23, compared to Rs 82.65 crore in FY22. PAT (profit-after-tax) margin improved to 4.79 percent from 4.08 percent in the same period.

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ASK Automotive is the largest manufacturer of brake-shoe and advanced braking systems for two-wheelers in India with a market share of approximately 50 percent in Fiscal 2023 in terms of production volume for OEM and the branded independent aftermarket (IAM), on a combined basis.