Emmforce Autotech IPO bought 339 times on last day; surpasses Shivam Chemicals, Varyaa Creations public issues

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Automotive components manufacturer Emmforce Autotech's Rs 53.90-crore initial public offering (IPO) recorded a massive 338.87 times subscription on the final day of bidding, i.e. April 25, backed by robust response from across categories of investors.

Investors put in bids for 133.29 crore equity shares against the IPO size of 39.33 lakh equity shares, the subscription data on the BSE showed.

Non-institutional investors (high net worth individuals) were in the leading position to lift the public issue, buying 637.72 times the allotted quota, followed by retail investors who picked 267.62 times the portion set aside for them.

Qualified institutional investors bid 160.58 times the reserved portion.

In fact, the response to the Emmforce Autotech IPO has been strong since day one, i.e. April 23, when it was subscribed 20.21 times, while on the second day, the subscription was recorded at 69.25 times.

The Haryana-based automotive drivetrain parts maker's IPO comprised only a fresh issue of 54.99 lakh equity shares. The price band for the same was Rs 93-98 per share.

Also read: JNK India IPO: Issue subscribed 28.07 times, QIBs regain lead on final day

The company also received a healthy response for its anchor book launched for a day on April 22. Institutional investors, including BoFA Securities Europe SA, NAV Capital VCC, Persistent Growth Fund, and Craft Emerging Market Fun,  picked Rs 15.34 crore shares via anchor book.

Emmforce, which manufactures differential lockers & spools, 4WD locking hubs, spindles, axles & shafts, and yokes primarily for 4-wheel drive and performance racing vehicles, will spend Rs 10 crore out of the net fresh issue proceeds for subsidiary Emmforce Mobility Solutions' working capital requirement and margin money for term loan. Further, Rs 27 crore will be used for the working capital requirements of the company and the remaining funds for general corporate purposes.

Meanwhile, the Shivam Chemicals IPO also closes on April 25, subscribing 6.3 times with investors buying 2.9 crore equity shares against an offer size of 45.87 lakh equity shares.

Also read: Blackstone-backed Aadhar HF reduces IPO size to Rs 3,000 cr; targets early May launch at Rs 13,500-cr valuation

Retail investors took the lead, picking 8.88 times the allotted quota, and institutional & non-institutional investors bid 4.43 times the reserved portion.

The hydrated lime (calcium hydroxide) producer also opened its public issue of 45.87 lakh shares on April 23 with the aim to raise Rs 20.18 crore at a price of Rs 44 per share.

The Maharashtra-based company will use net fresh issue money for its working capital requirements, financing the augmentation of subsidiary Shivam Chemicals & Minerals' working capital capabilities, and general corporate purposes.

Further, the Rs 20.10-crore public issue of Varyaa Creations, which opened for four days since April 22, was booked 3.45 times on the last day today. Investors bought 46.24 lakh equity shares against the IPO size of 13.4 lakh shares.

Retail investors bid 6.08 times the portion set aside for them, and non-institutional investors picked 1.2 times the allotted quota.

Varyaa, which deals in wholesale trading of gold, silver, and precious stones, intends to raise Rs 20.10 crore via public issue of 13.4 lakh equity shares, comprising only a fresh issue component.

The IPO funds will be used for the establishment of the new showroom, purchase of inventory for the proposed new showroom, purchase of inventory; and general corporate purposes.

All these three companies will finalise the basis of allotment of their IPO shares by April 26 and their shares will be credited to the demat accounts of eligible investors by April 29.

The trading in equity shares of these companies will commence on the BSE SME with effect from April 30.

Grey Market Premium

Amongst these three, Emmforce Autotech shares attracted robust interest in the grey market, trading at more than double the issue price but Shivam Chemicals and Varyaa Creations did not attract any premium in the grey market, an unofficial market for trading in IPO shares till the listing, the market observers said.

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