Diffusion Engineers IPO subscribed over 114X times on day 3 of issue, NII portion booked highest; Latest GMP here

Diffusion Engineers IPO: The initial public offering (IPO) of heavy welding consumable items maker Diffusion Engineers Limited was oversubscribed by over 114 times on the third and last day of issue. The mainboard IPO of the Nagpur-based company opened for subscription on Thursday, September 26, 2024, and closed on Monday, September 30, 2024.

Diffusion Engineers aims to raise ₹158 crore by issuing fresh shares. The company has reserved not more than 20 per cent of the shares in the public issue for qualified institutional buyers (QIB), not less than 15 per cent for non-institutional institutional investors (NII), and nearly 35 per cent of the offer is reserved for retail investors. Fifty per cent was reserved for anchor investors.

Also Read: Diffusion Engineers IPO Day 3: GMP, subscription status, key dates, more. Should you subscribe or not?

Diffusion Engineers IPO Subscription Status

On the third and final day of the issue, Diffusion Engineers IPO subscribed 114.49 times. According to BSE data, the portion reserved for QIBs was booked 95.74 times, the portion reserved for NIIs was booked the highest at 207.60 times, and the portion reserved for retail investors was booked the highest at 85.61 times. The employee portion was booked 95.03 times. The IPO received 75,54,83,608 share applications against 65,98,500 shares offered on Monday. On the first day of issue, the IPO was booked 7.16 times.

Diffusion Engineers IPO Latest GMP

According to stock market experts, the Diffusion Engineers IPO GMP, or grey market premium, dropped to ₹55 per share today, which shows subdued interest among investors. 

Diffusion Engineers' shares are trading higher by ₹223 in the grey market, a premium of 32.74 per cent to the issue price of ₹168 per share. According to investorgain.com, the lowest GMP is Re 50, while the highest is ₹90. 'Grey market premium' indicates investors' readiness to pay more than the issue price.

Diffusion Engineers IPO Details

Diffusion Engineers IPO is a book-built issue of ₹158 crore, a fresh issue of 0.94 crore shares. The company has fixed the Diffusion Engineers IPO price band at ₹159 to ₹168 per equity share. A bidder can apply in lots, and one lot comprises 88 company shares. Unistone Capital has been appointed as the lead manager of the public issue.

Also Read: Diffusion Engineers IPO day 2: GMP, subscription status, other details. Should you apply?

The issue includes a reservation of up to 50,000 employee shares at a discount of ₹8 to the issue price. The allotment for the Diffusion Engineers IPO is expected to be finalised on Tuesday, October 1, 2024. Diffusion Engineers will list on BSE and NSE, with a tentative listing date fixed as Friday, October 4, 2024.

Diffusion Engineers Company Details

Diffusion Engineers Limited manufactures welding consumables, wear plates and parts, and heavy machinery for core industries. The company also offers specialised repair and reconditioning services for heavy machinery and equipment. Between March 31, 2024, and March 31, 2023, Diffusion Engineers' revenue increased by 10 per cent, and profit after tax (PAT) rose by 39 per cent.

The company also trades in wear protection powders and welding and cutting machines. Its production facilities offer the super conditioning process, a surface treatment for machine components that increases wear resistance, eliminates stresses, and improves reparability, ultimately extending service life and reducing production costs.

Also Read: Hyundai Motor India, Swiggy, Vishal Mega Mart, among others receive SEBI approval to float IPOs

Diffusion Engineers IPO Review

“India’s heavy engineering capital goods industry is estimated to be ₹3,100-3,200 billion as of fiscal 2024 and is projected to clock a CAGR of 7.5-8.5 per cent over fiscals 2023- 27 to reach ₹3,800-3,900 billion. Diffusion Engineers plans to use this growth-fuelled environment by strategically expanding into nickel, cobalt, and iron-based powder manufacturing for an enhanced welding consumables portfolio,” said domestic brokerage Master Capital Service Ltd.

"The company also intends to expand its geographical reach and increase its exports through its subsidiaries and joint ventures. Further, the company focuses on diversifying its anti-wear solutions and heavy engineering equipment business into new industries and providing customised solutions across various industries. Investors can invest in the IPO for the medium to long term," the brokerage added.
 

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.