Carraro India, a prominent manufacturer of transmission systems and components for agricultural and construction equipment, launched its much-anticipated Initial Public Offering (IPO) on December 20, 2024. The ₹1,250 crore IPO, entirely an Offer for Sale (OFS), aims to provide an exit route for existing shareholders. Despite the company's strong market presence, the IPO witnessed a lukewarm response on its opening day, with only 5% subscription recorded by 12:40 PM.
Carraro India IPO Details
- Issue Size: ₹1,250 crore (entirely OFS)
- Price Band: ₹668 to ₹704 per share
- Lot Size: 21 shares and multiples thereof
- IPO Dates: December 20 to December 24, 2024
- Listing: BSE and NSE
Day 1 Subscription Status
As of December 20, 2024, the subscription details are as follows:
Investor Category | Subscription (Times) |
Qualified Institutional Buyers (QIBs) | 0.00 |
Non-Institutional Investors (NIIs) | 0.02 |
Retail Individual Investors (RIIs) | 0.07 |
Total | 0.04 |
Data as of 11:32 AM on December 20, 2024.
Grey Market Premium (GMP) Analysis
The Grey Market Premium (GMP) serves as an informal indicator of an IPO's potential listing performance. For Carraro India, the GMP stood at nil as of 1:00 PM on December 20, 2024, suggesting that the shares are expected to list at par with the issue price.
Company Overview
Established in 1997, Carraro India specializes in designing and manufacturing axles, transmissions, and gears for the agricultural and construction sectors. Operating from two state-of-the-art facilities in Pune, the company boasts comprehensive capabilities, including casting, machining, assembly, and testing. As a Tier 1 supplier, Carraro India has established a robust network of over 220 domestic suppliers across eight states and 58 international suppliers.
Financial Performance
Between FY2023 and FY2024, Carraro India reported a 4% increase in revenue and a 29% rise in Profit After Tax (PAT), reflecting steady financial growth.
Investor Considerations
The tepid initial response to the Carraro India IPO may be attributed to several factors:
- Market Sentiment: Prevailing market conditions and investor sentiment can significantly influence subscription rates.
- Valuation Concerns: Potential investors might be evaluating the company's valuations relative to its peers.
- Offer for Sale Structure: Since the IPO is entirely an OFS, the proceeds will not be utilized for business expansion, which could be a consideration for growth-focused investors.
Key Dates to Remember
- IPO Closing Date: December 24, 2024
- Allotment Finalization: December 26, 2024
- Refund Initiation: December 27, 2024
- Shares Credit to Demat Accounts: December 27, 2024
- Listing Date: December 30, 2024
Conclusion
While the Carraro India IPO has commenced with a subdued response, it's essential for investors to conduct thorough due diligence, considering both the company's fundamentals and prevailing market conditions. As the subscription period progresses, investor interest may evolve, influenced by broader market trends and individual investment strategies.
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