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Carraro India IPO: Check GMP, Final Day Subscription Status, Price Band And More
- Auto parts manufacturer Carraro India Ltd.'s Rs 1,250-crore initial public offering (IPO) subscription has ended, with the retail basket subscribed only 35% on its second day, and a low grey market premium (GMP) as of Tuesday morning (remain unchanged at nil), implying little to no investor interest.
- The company is a technology-driven integrated supplier specializing in the development of complex engineering products and solutions for original equipment manufacturer clients, with a focus on axles, transmission systems, and gears for construction vehicles and agricultural tractors in India.
- The IPO comprises a pure offer-for-sale of shares worth Rs 1,250 crore with a price band of Rs 668-704 per share.
- Allotment of shares is expected to be finalized on Dec 26, while the tentative date of listing on BSE and NSE is Dec. 30.
- The estimated listing price based on the GMP is Rs 704 a share, implying no gains over the upper limit of the price band.
- For retail investors, the minimum lot size is 21 shares requiring an investment of Rs 14,784 at the upper range of the price band.
- For small non-institutional investors, the minimum investment size is 14 lots, or 294 shares, amounting to Rs 2,06,976, while for large NIIs, it is 68 lots or 1,428 shares, for Rs 10,05,312.
- Carraro's financials reveal that in the fiscal year ending March 2024, the company's revenue was Rs 1,770.5 crore, a 4.4% growth compared to the previous year when it was Rs 1695.12 crore. Furthermore, the IPO's use of proceeds will entirely be a pure offer for sale without any money going toward the company.
- Carraro's listed peers include Escorts Kubota, Schaeffler India, Sona BLW Precision Forgings, Ramakrishna Forgings, Happy Forgings, and Action Construction Equipment.
- The key risks faced by the company includes over 70% of the company's revenue stemming from its top five customers and 86.29% from its top 10 customers, any disruption in those relationships could have a significant negative effect on its business. Additionally, the company relies on other entities within the Carraro Group for operations such as brand licensing, customer sourcing, procurement, R&D, and general support.
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