The initial public offering of HP Adhesives has received bids for 87.96 lakh equity shares against the IPO size of 25.28 lakh equity shares, subscribed 3.48 percent on the first day of bidding, December 15.
HP Adhesives is a multi-product, multi-category consumer adhesives and sealants company, with a distribution network of 4 depots (Delhi, Kolkata, Bengaluru and Indore) and over 750 distributors, who cater to more than 50,000 dealers in India.
Retail investors bought 18.57 times of their reserved portion of shares.
However, the part set aside for non-institutional investors has been subscribed by 38 percent, while qualified institutional buyers are yet to put in bids for the offer.
Click Here To Know All IPO Related News
The company aims to mop up Rs 126 crore via its public issue at the upper end of the price band of Rs 262-274 per equity share, of which Rs 56.68 crore was raised from anchor investors on December 14.
The IPO consists of a fresh issue of 41.4 lakh shares and an offer for sale of 4.57 lakh shares by promoter Anjana Haresh Motwani.
"Considering the trailing twelve months (September-2021) adjusted EPS (earnings per share) of Rs 5.57 on post issue basis, the company is going to list at a P/E (price-to-earnings) of 49.23 with a market cap of Rs 503.5 crore, while its peer, namely Pidilite Industries, is trading at a P/E of 89.75," said Marwadi Financial Services.
The brokerage has assigned a "subscribe" rating to the IPO given its growth prospects, an established brand presence and reasonable valuations.
Also read - HP Adhesives IPO opens: 10 key things to know about the offer
HP Adhesives offers a wide range of consumer adhesives and sealants such as PVC, cPVC and uPVC solvent cement, synthetic rubber adhesive, PVA adhesives, silicone sealant, acrylic sealant, gasket shellac, other sealants and PVC pipe lubricant which are sold across India.
The proceeds from the fresh issue will be used for expansion and incremental working capital requirement.
The company has a multi-product manufacturing facility at Narangi in Raigad (Maharashtra), which is strategically located in close proximity to Jawaharlal Nehru Port Trust (JNPT).
In FY21, it sold products in 21 countries including Bahrain, Bangladesh, Ghana, Greece, Iraq, Kuwait, Mauritius, UK, USA and others.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
