Tega Industries IPO: Tega Industries, which manufactures consumables for the mining company, is set to close its three-day initial public offering (IPO), on December 3, Friday, amid a healthy response from investors. As of the second day of bidding, the issue was subscribed 13.87 times, with high demand from non institutional buyers. The Tega Industries IPO was fully booked within hours of its opening as bidders grabbed the opportunity. The Tega Industries IPO will be the first such public offer in the last month of this year, that is December. Established in 1976, Tega Industries Limited is a leading manufacturer as well as distributors in specialised, critical, and recurring consumable products.
Tega Industries IPO Subscription Status
The Tega Industries IPO was oversubscribed 13.87 times as of Thursday, which was the second day of the bidding. Qualified Institutional Buyers bid for 91,50,603 shares, which was 3.35 times the portion reserved for them. Non institutional buyers booked 20.48 times the shares reserved for them while retail buyers placed bids for 8,15,41,152 against the 47,84,318 shares set aside for them. The bidding window has opened again at 10 am on Friday.
Tega Industries IPO Price Band, Key Details
Tega Industries has fixed the price band of its IPO at Rs 443-453 for one share. The window, which opened on December 1, will close on December 3 after a three-day bidding process. At the upper end of the price band, one lot of 33 shares would cost Rs 14,949 per lot.
The entire issue will be an Offer For Sale, and there will be no fresh issue. A total of 1,36,69,478 equity shares will be sold during the offer by selling shareholders as well as existing promoters. The company seeks to raise up to Rs 619.22 crore though the offer.
The Kolkata-based company will not receive any proceeds from the issue and the entire amount will go to to the selling shareholders.
Tega Industries IPO GMP
Tega Industries IPO GMP today was trading at Rs 410, as per data from IPO Watch. This was 90.50 per cent up from the upper end of the price band of Rs 453. The high grey market premium of Tega Industries IPO indicated a strong listing of the company at the stock markets later this month.
Tega Industries IPO Key Strength
Tega Industries Limited is a leading producer of specialised and “critical to operate” products, with high barriers to replacement or substitution and boasts of a consistent growth characterised by operational efficiency and high repeat business. It has a diverse global presence with strong manufacturing and sales capabilities.
Tega Industries IPO: Should you Subscribe?
Ashika Research: In terms of the valuations, on the higher price band, TIL demands a P/E multiple of 22.0x based on FY21 post issue fully diluted EPS. Being the 2nd largest producer of polymer-based mill liners in the world, TIL has highly diversified revenue stream from various geographies of the world. The company also plans to expand its manufacturing services both in India and overseas. Moreover, their deep relationships with some of the world’s largest senior miners and order book of Rs 316.14 crore as of June 30, 2021 allows them significant visibility to plan for future growth. Considering the market entry barriers, positive global outlook, long term relationships with key customers, high profitability and strong backing of the promoter group, TIL has strong growth prospects in the long term. Hence, it is recommended to “SUBSCRIBE” the issue from the long term perspective.
TopShareBrokers.com: The Issuer provides a wide range of products and solutions for processing across different stages of mineral processing and the products are critical to the overall productivity of a mineral processing site. In-house R&D and manufacturing capabilities, including design, process engineering, and manufacturing facilitate customized designs in a short time frame, offer comprehensive solutions and better service standards to the customers, and enable cross-selling of multiple products. The sector in which the Issuer operates is a capital and working capital intensive sector. The Issuer has grown with both organic and inorganic acquisitions in the past. The Issuer has reasonable profit margins and the financials show an increasing trend in the last three fiscals. Looking at the reasonable valuations of the Issue, one may apply to the IPO for the short to medium term.