Azad Engineering IPO subscribed 11 times, HNI portion booked 23 times on second day

Azad Engineering IPO

Azad Engineering IPO was subscribed 11.09 times on the second day of bidding, December 21, with bids for 11.22 crore shares against an issue size of 1.01 crore shares. Retail investors bought 11.15 times and high net-worth individuals picked 23.49 times the allotted quota, while qualified institutional buyers picked 1.53 times shares of the reserved portion.

Also Read: Sachin Tendulkar backed-Azad Engineering IPO opens for subscription: Should you subscribe to the issue?

The Rs 740 crore public offer which will close on December 22, comprises fresh issue of shares worth Rs 240 crore and an offer for sale of shares worth Rs 500 crore by the stakeholders. The price band for the issue had been fixed at Rs 499-524 per share with a lot size of a minimum of 28 equity shares followed by multiples of 28.

Of the fresh issue proceeds, the company will spend Rs 60.4 crore for buying plant and machinery and repaying debt of Rs 138.19 crore, the offer document said. The company’s borrowings stood at Rs 154.2 crore in the September quarter. The remaining funds will be used for general corporate purposes.

Also Read: Azad Engineering IPO: 10 things to know before subscribing to the Rs 740-crore issue

Azad Engineering’s net profit declined 71.2 percent from the previous year to Rs 8.5 crore in FY23. This decline was attributed to a weak operating margin and elevated finance costs. Revenue from operations, however, grew 29.4 percent to Rs 251.7 crore. EBITDA was up 16 percent to Rs 72.3 crore but the margin dropped 330 basis points.

Axis Capital Limited, ICICI Securities Limited, SBI Capital Markets Limited and Anand Rathi Securities Limited are the lead managers to the IPO, while Kfin Technologies Limited is the registrar.