Interarch Building Products Ltd has offered its IPO that was opened for subscription on Tuesday, August 19, 2024 and will be closed today, August 21, 2024. This IPO proposes to offer 60 million equivalent shares for a target of ₹600. Of the ₹500 crore raised through the QIP, ₹200 crore comprise a new issue and ₹400 crore an OFS. 29 crore of new equity with the share of stock ranging from ₹850 to ₹900. A lot of 16 shares is required for the retail investors’ minimum investment of ₹14,400.
Subscription Status
Since the beginning of the bidding process on the second day, the demand for the Interarch IPO was rather high, and it was subscribed 10. 83 times overall. The breakdown of subscriptions is as follows:The breakdown of subscriptions is as follows:
- Retail Investors: 7. 30 times
- Qualified Institutional Buyers (QIBs): That is why the following organizational learning model is suggested: 1.47 times
- Non-Institutional Investors (NIIs): 30. 81 times
This high level of interest especially from NIIs is an indicative of a positive market sentiment on the future of the company.
Grey Market Premium (GMP)
The grey market premium (GMP) for Interarch building product’s share is now ₹335 implying that the stock may actually be listed in the range of ₹1,255 per share, 39. At a 5% premium over the upper issue price of ₹900 per share. This premium indicates high investor optimism and forthcoming listing benefits; some analysts expect that the scrip could address a listing premium of over 25 per cent to its issue price.
Company Overview
Interarch Building Products was founded in 1983 and mainly deals in pre-engineered building (PEB). It provides design and engineering, production and supply, and onsite project solutions so it is a prominent contender in the Indian PEB industry. The company recorded a revenue of ₹1,293 crore in FY 2024 from ₹1,123 crore in FY 2023 while the profit after tax recorded was ₹86. 26 crore, which shows that there is rise in the financial performance year by year.
Analysts’ Recommendations
Most analysts recommend subscribing to the Interarch IPO based on several factors:Most analysts recommend subscribing to the Interarch IPO based on several factors:
- Market Position: Interarch is currently the second-largest PEB company in India and India PEB segment has revenue growth expected at 11-12% from FY 24 to FY 29 and hitting the market size of ₹ 330-340 Billion.
- Valuation: Going by the upper price end, the IPO is offered at a P/E ratio of about 17. 36, which most analysts will consider realistic as far as a company in such a market and the level of growth as exhibited by ALTR is concerned. When analysed in relation to other industries, it can be noted that the valuation is relatively low here.
- Growth Prospects: Such a requirement shall be used to establish a new facility in manufacturing, to modernize the current factories, improve information technologies, and meet the working capital needs. The idea behind this long-term investment is to improve the company’s operations and market presence.
Conclusion
Based on high subscription figures, positive GMP, and favorable analyst recommendations it can be concluded that for the investors seeking for long-term sources of increases in value of their assets, Interarch Building Products IPO may be of interest. The product market competition in building construction, future growth plans further prove that the company has bright future in the developed PEB market segment. This is especially so, as today is the last day for subscription of the shares by potential investors.
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