Carraro India IPO Subscribed 1.12 Times On Final Day; Check GMP
The Carraro India IPO GMP stands unchanged at nil, showing little non institutional investors interest in the public issue so far.
Carraro India Ltd.'s Rs 1,250-crore initial public offering was subscribed 1.12 times as of 7:00 p.m on its final day, with only the portion for institutional investors being over subscribed.
Opened on Friday, Dec. 20, the book-built public offer was subscribed 48%, with the retail basket subscribed only 35% on its second day.
The grey market premium of Carraro India remains at nil as of 5:30 p.m. on Tuesday, according to Chittorgarh's unit InvestorGain, showing little to no retail investor interest. The estimated listing price based on the GMP is Rs 704 a share, imply no gains over the upper limit of the price band.
The maiden public offer of the auto parts manufacturer will remain open for subscription till Dec. 24. The IPO comprises a pure offer for sale of shares worth Rs 1,250 crore.
With a price band of Rs 668 to Rs 704 per share, retail investors can apply for a minimum lot of 21 shares requiring an investment of Rs 14,784 at the upper range of the price band. For small non-institutional investors, the minimum investment size is 14 lots, or 294 shares, amounting to Rs 2,06,976. For large NIIs, it is 68 lots, or 1,428 shares, for Rs 10,05,312.
Allotment of shares is expected to be finalised on Dec. 26. Tentative date of listing on the BSE and NSE is Dec. 30.
Carraro India IPO Details
Issue open: Dec. 20.
Issue close: Dec. 24.
Issue price: Rs 668–704.
OFS size: Rs 1,250 crore.
Lot size: Minimum 21 shares, and then in multiples thereof.
Use Of Proceeds
Since the IPO is a pure offer for sale, the company will not receive any portion of the proceeds from the offer.
Business
The company is a technology-driven integrated supplier specialising in the development of complex engineering products and solutions for original equipment manufacturer customers.
As an independent tier-2 solution provider, the company focuses on axles, transmission systems, and gears for the agricultural tractor and construction vehicle industries in India. It offers end-to-end services across the value chain, with in-house product design and manufacturing capabilities for axles, transmission systems, gears, and other related components.
The company's promoter, Carraro S.p.A., is the parent company of the Carraro Group, a global leader in designing, manufacturing, and selling transmission systems (axles, transmissions, and drives) for agricultural and construction equipment, particularly for off-highway vehicles.
Financial Performance
In the last financial year, 64.82% of the company's revenues came from domestic sales. Profit for financial year 2024 stood at Rs 60.6 crore, marking a 29.4% increase from Rs 47 crore in the previous year, despite modest topline growth, driven by strong operating performance.
For the fiscal year ending March 2024, Carraro recorded revenue of Rs 1,770.5 crore, a 4.4% growth compared to the previous year when it was Rs 1,695.12 crore.
Listed Peers
According to the red herring prospectus, the company's listed peers include Escorts Kubota (P/E of 43.21), Schaeffler India (P/E of 74.22), Sona BLW Precision Forgings (P/E of 76.93), Ramakrishna Forgings (P/E of 42.82), Happy Forgings (P/E of 47.08), and Action Construction Equipment (P/E of 50.56).
Carraro India IPO: Key Risks
Over 70% of the company's revenue in fiscal 2024 came from its top five customers, and 86.29% from its top 10 customers. A failure to retain these key clients or attract new ones could adversely affect business performance.
Additionally, the company relies on other entities within the Carraro Group for various operations such as brand licensing, customer sourcing, procurement, R&D, and general support. Any disruptions in these relationships could have a significant negative effect on its business.
Carraro India IPO: Subscription Status Day Three
The IPO has been subscribed 1.12 times, as of 7:00 p.m. on Monday.
Qualified institutional buyers: 2.21 times.
Non-institutional investors: 0.60 times, or 60%.
Retail investors: 0.71 times, or 71%.
Carraro India IPO GMP Today
The grey market premium of Carraro India remains at nil as of 5:30 p.m. on Tuesday, according to Chittorgarh's unit InvestorGain, showing little to no retail investor interest. The estimated listing price based on the GMP is Rs 704 a share, imply no gains over the upper limit of the price band.
Investors should note that GMP is not an official price quote for the stock and is based on speculation.
Carraro India IPO: Should You Subscribe | Watch
Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read red herring prospectus thoroughly before placing bids.
