Key Points
- Stock opened at Rs 202 on NSE about 11 percent lower
- Shares rose over 9 percent intraday to high of Rs 224
- Nearly 79 percent of company revenue comes from exports
New Delhi, March 5. Shares of Omnitech Engineering made a weak debut on the Indian stock exchanges on Thursday, listing at Rs 205 on the Bombay Stock Exchange (BSE), nearly 10 per cent below the company’s IPO price of Rs 227 per share.
The precision-engineered components maker also listed at a discount on the National Stock Exchange of India, where the stock opened at Rs 202 apiece, about 11 per cent lower than its issue price.
Despite the weak start, the stock witnessed buying interest soon after listing. Omnitech Engineering shares rose more than 9 per cent from the listing price to touch an intra-day high of Rs 224 on the BSE.
However, even at the day’s high, the stock remained below its IPO price.
Listing Performance Versus Expectations
The listing was weaker than market expectations indicated by the grey market premium, which had suggested that the shares could list at a discount of around 2–3 per cent ahead of the debut.
The company manufactures high-precision and safety-critical components for global original equipment manufacturers and serves more than 256 customers across 24 countries. Nearly 79 per cent of its revenue comes from exports.
According to the company, the funds raised through the IPO will be used to set up new manufacturing facilities in Rajkot, invest in solar equipment and repay part of its debt.
Company Business and Global Customer Base
However, analysts say that relatively high borrowings and competition from industry players such as Azad Engineering, MTAR Technologies, and PTC Industries could keep the near-term outlook cautious.
The Omnitech Engineering IPO was open for subscription from February 25 to February 27, with a price band of Rs 216 to Rs 227 per share.
According to data from the National Stock Exchange of India, the Omnitech Engineering IPO was subscribed 1.14 times overall.
The retail investors’ portion was subscribed 33 per cent, while the non-institutional investors’ category saw 73 per cent subscription.
The qualified institutional buyers’ segment received a subscription of 2.86 times.
–IANS
pk
