Paras Defence most bought IPO at 304x

MUMBAI: The Rs 171-crore IPO of Navi Mumbai-based Paras Defence & Space Technologies closed with an over-subscription of 304 times, making it the highest ever subscribed initial offer in India’s capital market history. The offer for the supplier to the defence and space sectors in India and abroad was in the price band of Rs 165-175 per share and closed on Thursday.
According to BSE data, the portion of the offer reserved for non-institutional investors was subscribed nearly 928 times. The part reserved for retail investors was subscribed almost 113 times, while the institutional investors’ category was subscribed about 170 times. In terms of subscription figures, the Paras Defence IPO is followed by Salasar Technologies with 273 times subscription, Apollo Micro Systems with 249 times, and Astron Paper with 242 times.
For 2021, the second-most subscribed offer was MTAR Technologies, which is in the defence supplies business too. The issue was subscribed 201 times. So far this year, in addition to MTAR Tech and Paras Defence, Data Patterns, a Hyderabad-based company that is in the same line of business, has also filed to go public. According to industry players, the government’s Atmanirbhar Bharat initiative for various sectors of the economy, including defence supplies, is leading to this surge in listing of companies in this segment.
Paras Defence has five lines of businesses — manufacturing of defence & space optics products, defence electronics products, electro-magnetic pulse protection solutions, heavy engineering products and critical imaging components for India’s space programme. Various arms of the government and also companies like Bharat Electronics (BEL), Hindustan Aeronautics (HAL) and TCS are its customers. It also supplies products and solutions to companies in Belgium and South Korea, it said in the offer document.
According to Astha Daga, senior VP at Anand Rathi Advisors, the lead manager to Paras Defence IPO, a very strong sector outlook coupled with its unique position as one of the leading ‘indigenously designed, developed and manufactured’ category of private sector companies in India generated strong investor interest. Also, due to the relatively modest size of the offering, a strong demand was witnessed. “In addition, market timing has also been very favourable as there were no other IPOs for investors to participate,” Daga said.
Defence, according to industry players, has been one of the focus areas for the government and Indian companies are seen as key beneficiaries of the Centre’s Atmanirbhar Bharat and Make in India schemes. While the same will benefit Paras Defence, the company’s biggest strength lies in its R&D capabilities and relationship with diverse customers, a release from the merchant bankers noted.

Leave a Reply