Harsha Engineers lists at 36% premium amid volatile market conditions

• Shares of Harsha Engineers listed at ₹450 against the allotment price of ₹330 per share.
• The IPO was subscribed 74.70 times amidst volatile market conditions.
• The market capitalisation of the company stood at ₹4,096 crore.

Ahmedabad-based Harsha Engineers International, which manufactures precision bearing cages, listed at ₹450 on the bourses on Monday amid volatile market conditions.

Investors made a profit of ₹120 per share and ₹5,400 on one allotment of the IPO. The market capitalisation of the company stands at ₹4,096 crore, according to BSE data.

Despite some weakness in the market, analysts had predicted a strong listing for the company’s shares due to its strong fundamentals and hefty grey market premium.

“We believe that the company may surprise the markets and might make a grand debut to list above its grey market premium. The company’s strong fundamentals, competitive advantages like high entry barriers and switching costs, experienced management team, and robust growth outlook explains the healthy GMP. Further, the company is a proxy play on India becoming the global manufacturing hub,” said Aayush Agrawal, senior research analyst at Swastika Investmart.

The IPO was subscribed a whopping 74.70 times amidst volatile market conditions. Qualified institutional investors’ subscription was 178 times the IPO offer, while the retail portion of the IPO saw a subscription of 17.63 times the offer.

Money raised through the IPO will be used for debt repayment, funding capital expenditure, purchase of machinery, infrastructure repairs, renovation of the existing production facilities and general corporate purposes.

The company’s business comprises two segments – engineering business and solar EPC business. Its engineering business manufactures bearing cages in brass, steel and polyamide materials; complex and specialised precision stamped components; welded assemblies and brass castings, among others.

The company’s profit grew by over four times in the last three financial years.


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