Sona Machinery makes weak market debut, lists at 12% discount on NSE SME

The company attracted significant interest from a diverse range of investors, with its public issue being oversubscribed 254.37 times.

Shares of Sona Machinery, an OEM of agro-processing machines, made a dismal start on its market debut on March 13, listing at a discount of 12.5 percent over the issue price of Rs 143 on the NSE SME.

However, soon after the listing, the share price gained slight momentum and was trading at Rs 131, 5 percent higher than the opening price.

The company attracted significant interest from a diverse range of investors, with its public issue being oversubscribed 254.37 times. Participants subscribed to 65.93 crore equity shares against the IPO size of 25.92 lakh equity shares.

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Non-institutional investors led the way, oversubscribing their allocated quota by 555 times, while retail investors and qualified institutional buyers subscribed 235 times and 129 times, respectively, of the portions set aside for them.

Sona aimed to raise to Rs 51.82 crore through the offer, which comprised of only a fresh issue of 36.42 lakh shares. Of the proceeds, it plans to allocate Rs 28.91 crore for establishing a new manufacturing unit at Ghaziabad, and Rs 2 crore for repaying the outstanding amount of the letter of credit. The remaining fresh issue money will be used for general corporate purposes.

The manufacturing facility of the company is well-equipped with the necessary infrastructure, including machinery and handling equipment, to ensure a seamless manufacturing process.

India's food processing sector, one of the world's largest, is anticipated to achieve an output of $535 billion by 2025-26. This sector plays a crucial role in connecting Indian farmers with consumers in both domestic and international markets.

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