SME action: Royal Arc Electrodes, Tejas Cargo India IPOs sail through on final day

IPO Updates

The initial public offerings of Royal Arc Electrodes as well as Tejas Cargo India managed to sail through on their final day of bidding, i.e. February 18. The negative sentiment in the equity markets may be impacting the subscription numbers.

Both book-built public issues opened for subscription on February 14.

Royal Arc Electrodes IPO

The welding consumables manufacturer hit Dalal Street to raise Rs 36 crore via maiden public issue, which comprises of fresh issuance of 18 lakh shares worth Rs 21.6 crore, and an offer-for-sale of 12 lakh shares valued at Rs 14.4 crore at the upper price band.

The price band for the offer is Rs 114-120 per share.

The public issue was subscribed 1.55 times so far, as investors have picked 33.55 lakh shares so far on Tuesday, compared to the offer size of 21.6 lakh shares via 1,960 applications, the subscription data published on the NSE showed.

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Before opening the issue for public, on February 13, Royal Arc Electrodes had mobilised Rs 10.08 crore by allotting 8.4 lakh shares to several institutional investors at Rs 120 per share.

The company that makes welding electrodes, flux cored wire, and MIG/TIG wires will utilise fresh issue proceeds for the expansion of the manufacturing facility at Valsad (Gujarat), working capital requirements, and general corporate purposes. The offer-for-sale money will go to Sanghvi family, the selling shareholders.

Fedex Securities is acting as the book running lead manager to the issue.

Tejas Cargo India IPO

The public issue saw a 1.14 times subscription with investors buying 51.61 lakh shares against the offer size of 45.24 lakh shares via 2,960 applications.

The logistics company approached capital markets to raise Rs 105.84 crore via initial share sale of 63 lakh shares at Rs 168 per share. The IPO consists of solely fresh issue with no offer-for-sale component, while the price band for it has been fixed at Rs 160-168 per share.

Of which Rs 29.82 crore has already been raised by the company through its anchor book wherein it allotted 17.75 lakh shares to 8 institutional investors including Saint Capital Fund, Blue Star Capital Fund, Arrow Emerging Opportunities Fund, and Zeal Global Opportunities Fund.

Tejas Cargo that provides supply chain transportation services by road throughout India is going to utilise IPO proceeds for the purchase of additional trailers, working capital requirements, repayment of debt, and general corporate purposes.

The merchant banker handling the public issue is New Berry Capitals.

Meanwhile, both companies in consultation with their merchant bankers will finalise IPO share allotment by February 19. The trading in their equity shares will commence on the NSE Emerge effective February 24 as per the schedule, which may change.