Quadrant Future Tek IPO: Price Band, Financials, Risks, GMP — All You Need To Know

Quadrant Future Tek Ltd.'s initial public offering is scheduled to open on Tuesday. The IPO consists entirely of a fresh issue of one crore shares, with the company aiming to raise up to Rs 290 crore.

The price band for the IPO has been set in the range of Rs 275–290 per share.

Out of the total IPO size, 75% is reserved for qualified institutional buyers, 15% for non-institutional investors, and the remaining 10% for retail individual investors.

• Issue opens: Jan. 7

• Issue closes: Jan. 9

• Price band: Rs 275–290 per share

• Fresh issue size: Rs 290 crore

• Offer-for-sale: Nil.

• Total issue size: Rs 290 crore

• Lot size: Minimum 50 shares, and then in multiples thereof.

Incorporated in September 2015, Quadrant Future Tek develops next-generation train control and signaling systems for the Indian Railways' 'Kavach' project. This system aims to enhance safety and reliability for passengers.

It also operates a specialty cable manufacturing facility with an Electron Beam Irradiation Centre, producing cables for railway rolling stock and the naval defence industry.

The company has two main business divisions—specialty cables, and train control and signalling.

The company plans to utilise the IPO net proceeds towards the following objects:

• Funding long-term working capital requirements: Rs 149.7 crore

• Capital expenditure for the development of Electronic Interlocking Systems: Rs 24.4 crore

• Prepayment or repayment of outstanding working capital term loan availed by the company: Rs 23.6 crore

• General corporate purposes

• The business is dependent on a single manufacturing facility which exposes it to certain manufacturing process risks.

• The company’s customers operate in industries with specific sectors and rapidly changing preferences and technologies. Disruptions in these sectors can negatively affect the business.

• The company has recently expanded into the train control systems segment, making it difficult to predict the performance and future prospects.

The grey market premium for Quadrant Future Tek IPO stood at Rs 210 per share, with expected gain at 72.41%. With the price band at Rs 290, the estimated listing price stands at Rs 500.

Notably, GMP is not an official price quote and is based on speculation.

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.