Indo Farm Equipment IPO opens tomorrow: GMP, price band, issue size among 10 key things to know | Stock Market News

Indo Farm Equipment’s initial public offering (IPO) is poised to open for public subscription on Tuesday, December 31, and will close on Thursday, January 2. The company manufactures and sells tractors, pick-and-carry cranes, and other agricultural equipment.

As of December 30, the grey market premium (GMP) of Indo Farm Equipment IPO stood at ₹80 per share. Considering the upper price band for the issue at ₹215, the shares are expected to list at a premium of 37.21 per cent, according to data collected from Investorgain.com. 

The grey market premium is an indicator of investors’ willingness to pay more for the public issue.

“Indo Farm with traditional business value and experienced promoters and well-planned capacity expansion, debt repayment and strengthening of the financial arm is expected to be capitalising over the long run,” said the analysts at Anand Rathi, giving a “Subscribe-Long Term” rating to the public issue.

Indo Farm Equipment IPO — 10 key things to know

Indo Farm Equipment IPO Date: The public issue is set to open for subscription on Tuesday, December 31, and close on Thursday, January 2.

Indo Farm Equipment IPO Structure: The Chandigarh-based firm’s IPO consists of a fresh issue of 86 lakh equity shares along with an offer-for-sale (OFS) component of 35 lakh equity shares.

Indo Farm Equipment IPO Price Band: The company has fixed the price band for the public issue at ₹204 to ₹215 per equity share, with a face value of ₹10 per share. 

Indo Farm Equipment IPO Lot Size: The officer comprises a lot size of 69 equity shares and their multiples thereof.

Indo Farm Equipment Anchor Round: The public issue’s anchor round will be held on Monday, December 30. The details of the outcome will be released in the evening today.

Indo Farm Equipment IPO Objective: The company aims to use ₹50 crore of the net proceeds from the public issue to repay or prepay certain company borrowings, in part or in full. It also aims to use ₹70.07 crore to expand its pick-and-carry crane manufacturing capacity.

Apart from this, the company plans to invest ₹45 crore in its non-banking financial company (NBFC) subsidiary, Barota Finance Ltd., to finance its capital base and meet the non-banking lenders’ future capital needs. The remaining amount raised from the stock markets will be used for general corporate purposes. 

Indo Farm Equipment IPO reservation: According to the RHP, not more than 50 per cent of the net issue will be offered to Qualified Institutional Buyers (QIBs), not less than 15 per cent will be offered to the Non-Institutional Investors (NIIs), and not less than 35 per cent of the net issue is reserved for the retail investors.

Indo Farm Equipment IPO Book-Runners: Aryaman Financial Services is the book-running manager of the public issue, while MAS Services is the registrar of the offer.

Indo Farm Equipment Business Overview: The company’s 52.16 per cent of the total revenue is from Tractor sales, followed by the Pick and Carry Cranes segment sales at 47.77 per cent, and the remaining 0.07 per cent is from other income. The company also operates a non-banking financial company (NBFC), Barota Finance Limited.

Indo Farm Equipment IPO Key Risks: Any reduction of demand, manufacturing, financing support from the banks, seasonal issues, etc., in the major two segments can adversely hamper the company’s business.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.