The maiden public offer of HP Adhesives, a fast-growing multi-product and multi-category consumer adhesives and sealants company, was subscribed 8.03 times on day two, December 16.
It received bids for 2.03 crore equity shares against the IPO size of 25.28 lakh equity shares.
The company is going to raise Rs 126 crore through its public issue, at the upper price band of Rs 274 per share. The offer comprises a fresh issue of 41.4 lakh equity shares and an offer for sale of 4.57 lakh shares by shareholder Anjana Haresh Motwani.
Retail investors bought 40.29 times of the portion set aside for them, and the allotted quota of non-institutional investors was subscribed 190 percent. Qualified institutional buyers portion was subscribed 34 percent.
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In its product category of PVC solvent cement, the company is amongst the leading manufacturers in India in the consumer/ bazaar segment of the adhesive industry.
"The company has experienced promoters with a strong management team that has domain knowledge. The company also has an extensive sales and distribution network, and has strategically located manufacturing facilities with improving operational efficiency. Hence, we recommend “subscribe” on issue," said Hem Securities.
Also read - HP Adhesives IPO. Should you subscribe to the issue?
HP Adhesives' revenue from operations has grown from Rs 3.56 crore in FY10 to Rs 118.16 crore in FY21, registering a CAGR of 37.5 percent in the past 11 years.
As of September, the company’s distribution network comprised 4 depots situated in Delhi, Kolkata, Bengaluru and Indore, and more than 750 distributors who cater to over 50,000 dealers in India.
Also read - HP Adhesives IPO: 10 key things to know about the offer
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