Harsha Engineers IPO is subscribed 10.35 times on day 2

• The public offering of Ahmedabad-based Harsha Engineers International has been subscribed 10.35 times on the second day.
• The company plans to raise ₹755 crore through this IPO.
• The lender has fixed the price band at ₹314-330 per share.
• Shares of the company are commanding a premium of ₹225 from ₹210 earlier in the grey market.

The initial public offering (IPO) of Ahmedabad-based Harsha Engineers International, which manufactures precision bearing cages has been subscribed 10.35 times on the second day.

The IPO received strong demand from non-institutional and retail investors. Overall, it received bids of 17.45 crore shares against 1.68 crore equity shares on offer.

The company plans to raise ₹755 crore through this IPO consisting of a fresh issue of equity shares worth ₹455 crore and an offer for sale by promoters of up to ₹300 crore.

The proceeds from the IPO will be utilised for debt repayment, funding capital expenditure, purchase of machinery, infrastructure repairs, renovation of the existing production facilities and for general corporate purposes.

Category of investors	Subscription status
Qualified institutional buyers	1.63 times
Non institutional investors	24.91 times
Retail	9.14 times
Overall	10.35 times

The company’s business comprises two segments – engineering business and solar EPC business.

The company supplies its products to over 25 countries across five continents i.e., North America, Europe, Asia, South America and Africa.

Ahead of its initial share sale, Harsha Engineers had raised ₹225.7 crore from anchor investors including American Funds Insurance Series Global Small Capitalization Fund, Goldman Sachs Funds - Goldman Sachs India Equity Portfolio, PineBridge Global Funds - PineBridge India Equity Fund and Abu Dhabi Investment Authority-Monsoon.

The shares of the company are currently commanding a grey market premium or GMP of ₹225 from ₹210 per share earlier.

GMP is the premium at which IPO shares are traded in an unofficial market before they are listed on the stock exchanges. The IPO opened on September 14, and will close on September 16.

Most analysts have recommended subscribing to the IPO following the company’s dominant position in the industry.

“Harsha Engineers International with its dominant position is well placed to capture the growing bearing cage demand across industries. We like its increasing focus on other specialised precision components and on the growing EV segment which could boost its EBITDA margins,” said analysts at Motilal Oswal.

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