Gala Precision Engineering IPO opens on Monday. GMP, review, other details in 10 points

Gala Precision Engineering IPO: The mainboard initial public offering (IPO) of precision components manufacturer Gala Precision Engineering Limited will open for subscription on Monday, September 2. The Maharashtra-based firm manufactures precision components such as disc and strip springs (DSS), coil and spiral springs (CSS), and special fastening solutions (SFS). The company supplies these products to original equipment manufacturers (OEMs).

The company's products are used in sectors such as electrical, off-highway equipment, infrastructure, and general engineering, as well as in mobility segments such as automotive and railway. The company has supplied its technical springs and high-tensile fasteners to customers in several countries, including Germany, Denmark, China, Italy, Brazil, the USA, Sweden, and Switzerland, making it a crucial link in the global supply chain for OEMs. 

Also Read: Gala Precision Engineering IPO: Firm mobilises ₹50 crore from anchor investors; Subscription window opens on Sept 2

Gala Precision Engineering IPO includes a fresh issue and an offer-for-sale (OFS) from the existing shareholders. According to the draft red herring prospectus (DRHP), promoters hold a 74.56 per cent stake in the company, with the remaining shares held by the public, including Pooja Unichem LLP. 

In the OFS, promoter Vishanji Harshi Gala will be the primary selling shareholder, intending to divest 3,85,200 equity shares. The remainder of the shares, totalling 2,30,800 equity shares, will be sold by Kirit Vishanji Gala (HUF), Nayna Gala, Satish Kotwani, Hemlata Dhiraj Shah, Dhiraj Nanchand Shah, Urmil Dhiraj Shah, and Rupa Sunil Mehta.

Also Read: Gala Precision Engineering IPO to open for subscription on September 2;price band set at ₹503-529 apiece

Here are top 10 things to know about Gala Precision Engineering IPO:

1.Gala Precision Engineering IPO key dates: The mainboard issue is all set to hit the D-Street for its three-day subscription on Monday, September 2, and will close on Wednesday, September 4. 

2.Gala Precision Engineering IPO price band: The price band for the offer has been determined at ₹503 – ₹529 per equity share at the face value of ₹10 each.

3.Gala Precision Engineering IPO details: The IPO consists of a fresh issue of up to 25,58,416 equity shares and an offer for sale (OFS) of up to 6,16,000 equity shares by the promoter group and individual selling shareholders.  The IPO will fetch ₹167.93 crore at the upper end of the price band.

4.Gala Precision Engineering IPO lot size: Investors can bid for at least 28 equity shares and in multiples of 28 equity shares thereafter. The floor price is 50.3 times the face value of the equity shares, and the cap price is 52.9 times the face value of the equity shares.

5.Gala Precision Engineering IPO objectives: The company intends to use the net proceeds to finance the following goals: establishing a new facility in Vallam-Vadagal, SIPCOT, Sriperumbuddur, Tamil Nadu, to manufacture hex bolts and high-tensile fasteners; financing the capital expenditure needed to buy machinery, plant, and equipment in Wada, Palghar, Maharashtra; repaying or prepaying some of the company's borrowed funds, in full or in part; and general corporate purposes.

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6.Gala Precision Engineering IPO reservation: Gala Precision Engineering IPO has reserved not more than 50 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 not less than 35 per cent of the offer is reserved for retail investors.

7.Gala Precision Engineering IPO allotment date and listing date: Tentatively, Gala Precision Engineering's IPO basis of allotment of shares will be finalised on Thursday, September 5. The company will initiate refunds on Friday, September 6, and the shares will be credited to the demat account of allottees on the same day following the refund. Gala Precision Engineering's share price will likely be listed on BSE and NSE on Monday, September 9.

8.Lead Manager and Registrar of Gala Precision Engineering IPO: PL Capital Markets Private Limited is the book-running lead manager of the Gala Precision Engineering IPO, while Link Intime India Private Ltd is the registrar for the issue.

9.Gala Precision Engineering IPO anchor investors fundraise: Gala Precision Engineering Limited has raised ₹50.29 crore from anchor investors ahead of its IPO subscription. The company allocated 9,50,586 equity shares at Rs. 529 per share to the anchor investors. The foreign and domestic Institutions participating in the anchor round were NAV Capital Emerging Star Fund, Negen Undiscovered Value Fund, and others.

Also Read: Gala Precision Engineering files draft papers with SEBI to raise funds via IPO

10.Gala Precision Engineering IPO GMP Today: GMP or grey market premium was ₹240. This indicates that Gala Precision Engineering's share price was trading at a premium of ₹240 in the grey market, according to investorgain.com. Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Gala Precision Engineering was indicated at ₹760 apiece, which is 45.37 per cent higher than the IPO price of ₹529. 'Grey market premium' indicates investors' readiness to pay more than the issue price.