The initial public offering (IPO) of IdeaForge Technology, the drone manufacturing company, continues to draw investors in big numbers, with the issue subscribed 50.3 times by the afternoon of June 28, the third day of bidding.
Investors have bought 23.38 crore equity shares against an offer size of 0.46 crore, subscription data available on exchanges shows.
Retail investors have bid 64.48 times the portion reserved for them. Employees have bid 63.99 times their quota. As many as 13,112 shares have been set aside for them at a discount of Rs 32 a share to the final issue price.
High networth individuals bought 64.06 times the allotted quota and the portion reserved for qualified institutional investors was subscribed 38.62 times.
The closing date for the offer has been extended to June 30 after the exchanges pushed the Bakri ID holiday by a day to June 29, also the day the IPO was to close The company requested SEBI to allow it a day’s extension, which the regulator agreed to, IdeaForge said in an exchange filing.
The company has reserved 75 percent shares of the offer for qualified institutional buyers (QIB), 15 percent for high networth individuals (HNI) and the remaining 10 percent for retail investors.
Looking to raise Rs 567 crore, the unmanned aircraft systems manufacturer opened the IPO on June 26 in a price band of Rs 638-Rs 672 a share.
The offer consists of a fresh issue of Rs 240 crore and an offer for sale of 48.69 lakh equity shares by shareholders.
The fresh issue proceeds will be used for repaying debt, meet working capital requirements and for investment in product development.
Also read: Ideaforge Technology IPO: All you need to know about the company
Brokerage views
Motilal Oswal likes IdeaForgeand cites its complex/wide product portfolio, presence in niche space, strong client relationship and high entry barriers.
"The issue is valued at 5x P/BV (peers average: ~8x) on a post issue basis, which is fairly valued," the brokerage has said.
IdeaForge can benefit from the government's push for defence space as well as rising enterprise demand. It recommends subscribing to the offer.
Given the current buoyant market and high interest in defence stocks, the issue can see listing gains as well, it has said.
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Anand Rathi, too, says the company is fairly valued. "Thus, we recommend a “subscribe- long term” rating to the IPO considering its future growth prospects," the brokerage said.
IdeaForge manufactures unmanned aircraft vehicles for mapping, security and surveillance. These drones are capable of a wide range of mining area planning, and mapping applications, the company said.
With a diversified product portfolio, IdeaForge enjoys a market share of 50 percent. It ranked seventh globally in the dual-use category (civil and defence) drone manufacturers as of December 2022.
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