Interarch Building Products IPO booked 2.21 times on Day 01; retail, NII portion fully subscribed

The initial public offering (IPO) of Interarch Building Products has seen robust demand from both retail and non-institutional investors on its first day of bidding. The IPO, which opened today and is set to close on Wednesday, August 21, was fully subscribed just hours after the bidding began.

By 3:30 p.m., the IPO had received bids for 10,267,264 shares, compared to the total offering of 4,653,341 shares, resulting in an overall subscription rate of 2.21 times, according to data from Chittorgarh.

Retail investors showed strong interest, with their portion subscribed to 2.16 times, while non-institutional buyers showed even greater enthusiasm, with their portion booked 5.17 times.

Interarch Building Products aims to raise ₹600 crore through the IPO, which includes a mix of fresh equity shares and an offer for sale. The price band for the offer is set between ₹850 and ₹900 per equity share, with a face value of ₹10 each. The IPO lot size is fixed at 14 shares, requiring a minimum investment of ₹14,400 for retail investors.

The allotment for the IPO is expected to be finalised on Thursday, August 22, 2024. The shares are scheduled to list on both the NSE and BSE, with a tentative listing date of Monday, August 26, 2024. Ambit Private Limited and Axis Capital Limited are the book-running lead managers for the IPO, and Link Intime India Private Ltd is the registrar.

GMP signals over 30% premium

As of today, the grey market premium (GMP) for Interarch Building Products' IPO stands at ₹310 per share. This suggests that the shares are anticipated to list at ₹310 above their issue price. With this GMP and the IPO price, the estimated listing price of the shares would be ₹1,210, reflecting a 34.44% premium over the issue price of ₹900 per share.

The grey market premium represents the expected difference between an IPO’s issue price and its anticipated listing price in the unofficial market.

However, it’s important to remember that GMP is a preliminary indicator and should not be the sole factor in making investment decisions.

About Interarch Building

The company is one of the leading turnkey pre-engineered steel construction solution providers in India, with integrated facilities for design and engineering, manufacturing, and on-site project management capabilities for the installation and erection of pre-engineered steel buildings.

The company was ranked third in terms of operating revenue from PEB business in the financial year 2023 among integrated PEB players in India. It further had the second largest aggregate installed capacity of 141,000 metric tonnes per annum (“MTPA”) as of March 31, 2023, and a market share of 6.1% in terms of operating income in Financial Year 2023 among integrated PEB players in India, the company said in its DRHP report, citing the CRISIL report.

Its offerings are designed, engineered, and fabricated in accordance with customer requirements, and find use in construction for industrial, infrastructure, and building (residential, commercial, and non-commercial) end-use applications.

It has delivered PEBs for projects ranging from multi-level warehouses for customers engaged in e-commerce to paint production lines for customers engaged in the manufacturing of paints and the fast-moving consumer goods (“FMCG”) sector for setting up manufacturing units for manufacturing their products. The company's listed peers include Everest Industries and Pennar Industries, as per the DRHP report.

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