Unimech Aerospace and Manufacturing IPO: A Resounding Success Despite Market Sentiment
The initial public offering (IPO) of Unimech Aerospace and Manufacturing continues to attract robust investor interest, closing its second day with a subscription of 9.09 times on December 24, 2024. This overwhelming response comes despite prevailing bearish sentiment in the equity markets.
IPO Details
Unimech launched its maiden public issue on December 23, 2024, aiming to raise ₹500 crore, split equally between a fresh issue and an offer-for-sale of ₹250 crore each. The price band for the IPO is set at ₹745-₹785 per share.
As of the second day, investors had applied for 4.27 crore equity shares, significantly exceeding the 47.04 lakh shares on offer, as per data from the exchanges.
Investor Category Breakdown
- Non-Institutional Investors (NII): Subscribed 12.07 times their allocated portion.
- Retail Investors: Their reserved quota was booked 10.30 times.
- Qualified Institutional Buyers (QIB): Purchased 4.64 times the shares reserved for them.
- Employees: Demonstrated strong interest, with their reserved portion subscribed 15.56 times.
Grey Market Premium
The IPO’s shares are trading at a 60% premium over the upper price band in the grey market, reflecting strong demand and positive sentiment among market participants.
Company Overview
Based in Karnataka, Unimech Aerospace and Manufacturing specializes in:
- Aero Tooling
- Ground Support Equipment
- Electro-Mechanical Sub-Assemblies
- Precision Engineered Components
Its clientele spans industries such as aerospace, defense, energy, and semiconductors. With an order book of ₹80.75 crore and delivery timelines ranging from 4 to 16 weeks, the company stands as a key player in its niche.
Key Competitors
Unimech competes with prominent listed entities like:
- MTAR Technologies
- Azad Engineering
- Paras Defence and Space Technologies
- Data Patterns
- Dynamatic Technologies
Utilization of IPO Proceeds
The funds raised through the fresh issue will be utilized for:
- Purchasing Machinery and Equipment: To expand manufacturing capabilities.
- Working Capital Requirements: To support day-to-day operations.
- Debt Repayment: To strengthen the balance sheet.
- General Corporate Purposes: To fuel growth initiatives.
Subscription Timeline and Trading Commencement
The public issue is set to close on December 26, 2024, with trading of its equity shares expected to commence on December 31, 2024.
Conclusion
Unimech Aerospace and Manufacturing’s IPO has emerged as a strong performer, showcasing the company’s robust fundamentals and the confidence of investors across categories. The healthy subscription figures and significant grey market premium indicate a bright listing day ahead for the engineering solutions provider.
Stay tuned as this IPO success story unfolds in the coming days, potentially setting the stage for Unimech’s growth and expansion in competitive sectors.