TechEra Engineering made a notable debut on the stock market on October 3, listing at ₹125 per share. This represented a 52% premium over its issue price of ₹82 on the NSE SME platform, offering a positive opening for those who chose to invest in IPO. Despite the promising start, the gains were slightly below the grey market estimates, where shares had been trading at a nearly 70% premium.
Lower-than-expected listing premium
In the grey market, TechEra Engineering's shares had been trading at a much higher premium prior to the official listing. The grey market operates unofficially, allowing trading of shares before they are offered for public subscription and continues until the listing day. However, the actual listing saw a smaller premium than expected, though it still delivered significant gains.
IPO subscription details and investor interest
The public issue of ₹35.90 crore, involving 43.78 lakh fresh shares, garnered substantial attention. It was oversubscribed 70 times during the three-day subscription period. The bulk of the interest came from non-institutional investors, who subscribed 129 times the reserved portion. Retail investors showed strong demand, subscribing 66 times, while Qualified Institutional Buyers (QIBs) purchased 31 times their allotted quota.
TechEra Engineering’s background and services
TechEra Engineering (India) Limited, founded in 2018, specialises in providing precision tooling and components for the aerospace and defence sectors. Its product range includes assembly tools, jigs, fixtures, maintenance equipment, ground support machinery, and precision machined parts. The firm leverages advanced technologies such as 5-axis machining and 3D modelling to deliver high-quality solutions to its clients.
Use of IPO proceeds
TechEra Engineering plans to use the funds raised from the IPO to enhance its operations. The proceeds will be used to invest in new machinery, support working capital needs, repay certain debts, and cover general corporate expenses and issue-related costs. This provides potential benefits for those looking to invest in IPO opportunities within sectors like aerospace and defence.
Key takeaways
Investors considering opportunities to invest in IPO listings should consider companies like TechEra Engineering, which focuses on high-demand industries.
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