Danish Power IPO GMP soars amid healthy subscription on day 2, indicating stellar listing gains

Danish Power plans to use Rs 37 crore from the net issue proceeds to build a factory shed and install additional plant and machinery.

Danish Power's initial public offering (IPO) has garnered significant interest as its grey market premium (GMP) soared on the second day of subscription. The three-day public subscription period for the Rajasthan-based company began on October 22 and will close on October 24.

The company, a small and medium enterprise (SME), has set a price band of Rs 360-380 per share for its debut offer. Investors need to apply for a minimum lot size of 300 shares, with an initial investment of Rs 1,08,000 and a maximum of Rs 1,14,000 per lot.

Market watchers tracking the grey market activity have reported that shares of Danish Power are commanding a GMP of Rs 265. This suggests potential listing gains of nearly 70 percent, reflecting strong investor sentiment.

With a total issue size of Rs 197.90 crore, Danish Power's IPO is the largest ever in the SME segment. Earlier in 2024, KP Green Engineering had set a record with an issue size of Rs 189.5 crore, followed by Sahasra Electronics Solutions' Rs 186.2 crore IPO in September.

Founded in 1985, Danish Power operates two manufacturing units in Jaipur and is owned by the Talwar family. The company provides transformers and panels to clients like Tata Power Solar, Waaree Renewable Technologies, Jakson Green, ABB India, and Torrent Power. It competes with listed entities such as Indo Tech Transformers, Shilchar Technologies, and Voltamp Transformers.

Hem Securities is the merchant banker for the IPO, while Link Intime India has been appointed as the registrar to the issue.

Danish Power plans to use Rs 37 crore from the net issue proceeds to build a factory shed and install additional plant and machinery. Another Rs 85 crore will go towards working capital requirements, while Rs 20 crore will be used for debt repayment. The remaining funds will be allocated for general corporate purposes.

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