Danish Power IPO: Largest SME issue of the year opens – Check subscription status, GMP & other details

Danish Power's SME IPO opened for subscription on Tuesday, October 22. The three-day public offer will close on October 24. The company aims to raise ₹197.90 crore through the offering and has set a price band for the issue in the range of ₹360-380 per share. This will be the biggest SME IPO offering seen this year.

Danish Power IPO Subscription Status

The IPO witnessed overwhelming demand  and was subscribed 121.99 times by 3:45 pm on Day 3 of bidding. The IPO received bids for 42.49 crore equity shares against 34.83 lakh shares on offer.

The retail investor segment was booked 75.54 times, while the non-institutional investors (NII) category was subscribed 270.20  times. The Qualified Institutional Buyers (QIBs) portion was subscribed 100.08 times till now.

Danish Power IPO GMP today

The IPO's grey market premium (GMP) today is ₹290 per share, which indicates an expected listing price of ₹670, a premium of over 76 per cent over its issue price of ₹380. The GMP was the same in the previous session, October 23 but rose from ₹260 on October 22.

About the IPO

Danish Power IPO is a fresh issue of 52.08 lakh shares with no offer-for-sale component.

The net proceeds are intended to be utilised for several purposes, including funding capital expenditure for the expansion of the company's manufacturing facility through the construction of a factory shed and the installation of additional plant and machinery. Additionally, the funds will be used to meet working capital requirements, repay specific borrowings either partially or in full, and for general corporate purposes.

Retail investors must apply for a minimum lot size of 300 shares, amounting to an investment of ₹1.14 lakh. High net-worth individuals (HNIs) must apply for at least two lots, or 600 shares, totalling ₹2.28 lakh.

The allotment for the IPO is expected to be finalised on Friday, October 25, 2024. Meanwhile, the initiation of refunds for investors who were not allotted the shares and the credit of shares to the Demat account of the allottees will take place on Monday, October 28. The shares will be listed on the NSE SME platform on Tuesday, October 29, 2024.

Hem Securities Limited is the book-running lead manager of the Danish Power IPO, while Link Intime India Private Ltd is the registrar for the issue. The market maker for Danish Power IPO is Hem Finlease.

About the company

Founded in July 1985, Danish Power Limited specialises in the manufacture of a wide range of transformers, including inverter duty transformers designed for renewable energy projects like solar power plants and wind farms. The company also produces oil and dry-type power and distribution transformers, control relay panels, and provides substation automation services.

Review

"The company is engaged in the manufacturing of various types of transformers and also providing substation automation services. It marked steady growth in its top lines for the reported period, but the sudden boost in bottom lines from pre-IPO periods (FY24 onwards) raises eyebrows. Well-informed investors may park funds for long term," Dilip Davda of Chittorgarh.com said, assigning a 'may apply' rating to the issue.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.