The initial public offer of Tega Industries Limited, manufacturer of consumables for the mining industry, was fully subscribed within the one hour of opening for subscription on Wednesday.
The Rs 619.22-crore IPO received bids for 1,01,82,315 shares against 95,68,636 shares on offer, translating into 1.06 times subscription, according to NSE data.
The category for Retail Individual Investors (RIIs) received 2.10 times subscription while those meant for non-institutional investors got subscribed 7 per cent.
The initial public offer comprises up to 1,36,69,478 equity shares and has a price range of Rs 443-453 per share.
Tega Industries on Tuesday said it has garnered Rs 186 crore from anchor investors. Axis Capital and JM Financial are the managers of the offer.
Meanwhile, this is what brokerage houses are saying, according to a report published in Moneycontrol.
Marwadi Financial Services
The brokerage house said that considering the FY21 adjusted EPS of Rs 20.58 on a post-issue basis, the company is going to list at a P/E of 22.02 with a market cap of Rs 3,003 crore while its peer namely AIA Engineering Ltd is trading at a P/E of 30.40.
The company is prone to risks from disruption of supply of raw materials from its key suppliers as it does not have any long-term contracts with them.
Tega’s strong market position, innovative products and higher entry barriers are likely to help maintain its margins while consistent growth with high repeat business (74 percent) would augur well in the long run.
The company has a large dependence on international markets from where it generates close to 86 percent of its revenue. This can pose a risk to the business of the company.
The brokerage house feels that the company’s strengths outweigh the risks it faces from forex rate fluctuations, policy uncertainty, and any change in industry trends.
Kolkata-based Tega Industries offers comprehensive solutions to marquee global clients in the mineral beneficiation, mining and bulk solids handling industry, through its wide product portfolio.