Sansera Engineering Limited, the auto ancillary company, had recently closed its initial public offering (IPO). The issue which opened on September 14, stayed open for trading for a total of three days and closed on September 16. The public issue itself saw healthy participation from its investors over the course of the Sansera Engineering IPO. In total, the investors had subscribed to the issue around 11.47 times. Incorporated in 1981 this company manufactures complex and critical precision engineering components which it provides across the automotive as well as the non-automotive sectors. The company has 15 manufacturing plants across the country, 9 of these plants are located in Bangalore.
Here is a recap of what you need to know about the Sansera Engineering IPO before the listing takes place:
Sansera Engineering IPO Overview
The Sansera Engineering IPO had an issue size of Rs 1,282.98 crore with a total of 17244,328 equity shares. The public issue was also entirely an offer for sale (OFS) that amounted to the same. The issue was a book-built issue with a face value of Rs 2 per equity share. The price of the IPO was Rs 734 to Rs 744 per equity share.
Sansera Engineering IPO Grey Market Premium
The issue had a grey market premium (GMP) of Rs 50 at the time of this article, as per information on IPO Watch. This indicated that the issue was trading at a premium of Rs 784 to Rs 794 per equity share on the unlisted grey market.
Sansera Engineering IPO Allotment, Listing Date
The basis of allotment for this public issue is set to take place next week on September 21. Following this, the initial refunds would be rolled out to the unlucky bidders who did not manage to snag a share during the trading days of the issue. On September 23, the investors who were fortunate enough to acquire shares, will see the same deposited to their Demat accounts. In terms of the company’s listing, the date is tentatively set for next week Friday, which is September 24. However, this date is not yet confirmed.
Sansera Engineering IPO Subscription Status (Club Lot Size and Subscription)
The IPO had a minimum lot size of 20 shares that had an accompanying application amount of Rs 14,880. On the higher end of the lot, there were 260 shares with a maximum application amount of Rs 193,440. Of this lot range, the retail-individual investors (RIIs) were allowed to apply for up to 13 lots at the upper limit of the lot. In terms of subscriptions, the qualified institutional buyers (QIBs) had subscribed the most with a subscription of 26.47 times. The non-institutional investors (NIIs) had subscribed to the issue around 1.37 times and the RIIs had subscribed to it around 3.15 times over the course of the IPO. Employees also subscribed to the issue at 1.37 times.
Speaking on the company and the outlook for the future, Choice, a brokerage firm, said, “Business model is well diversified across customer base, geographical spread and product portfolio. As of FY21, SEL caters to 71 customers which includes 47 from automotive segment and 28 from nonautomotive segment. Revenue break-up on sub-segment wise include 50.4 per cent from two wheelers, 24.1 per cent from PVs and 13.1 per cent from CVs, aerospace at 3.8 per cent, off-road at 4.2 per cent in FY21.”
“At the higher price band of Rs 744, the issue is valued at P/E of 34.8x on FY21 EPS basis which is in line with peer avg. trailing P/E of 34x. As per our view, likely strong revenue growth and healthy EBIDTA margin over 15 per cent to boost profitability in coming future. Considering all these parameters, we assign ‘Subscribe’ rating to issue,” said Choice in a note. This indicated that there was a positive outlook for the company in the long term.