The public offer of Sona BLW Precision Forgings (Sona Comstar) witnessed a 27 percent subscription on June 15, the second day of bidding, amid interest across investor classes.
The retail portion has been booked 1.02 times, while the portion set aside for qualified institutional buyers has subscribed 14 percent and non-institutional investors 4 percent.
The Rs 5,550-crore public issue has received bids for over 2.91 crore equity shares against the offer size of over 10.71 crore equity shares, the subscription data available on the exchanges showed. The offer size is excluding anchor book that was opened for a day on last Friday.
The offer opened for subscription on June 14 and will close on June 16. The price band for the issue has been set at Rs 285-291 per equity share. The IPO comprises a fresh issue of Rs 300 crore and an offer for sale of Rs 5,250 crore by Singapore VII Topco III Pte Ltd, an affiliate of The Blackstone Group.
"We believe Sona Comstar IPO offer gives investors an opportunity to invest in a leading and diversified automotive systems and components company involved in designing, OEM manufacturing and supplying highly engineered products with high focus on EV motors components," said Mehta Equities which recommended risky investors to subscribe with caution of risk for decent listing gain.
The brokerage is optimistic about the electric vehicle (EV) components manufacturing sector as demand would rise going forward due to high fuel cost wherein Sona Comstar has growth opportunities for the long term.
"But one should also consider a few risks before making an informed decision to invest in this IPO. A major part of the issue is an offer for sale, and high competition in domestic as well as global markets can keep margins under check," said Mehta Equities.
Incorporated in 1995, Sona Comstar is one of India's leading automotive technology companies. It is into designing, manufacturing and supplying highly engineered, mission-critical automotive systems and components.
It caters worldwide to its clients in the US, Europe, India and China, for both electrified and non-electrified powertrain segments. Sona Comstar is among the top 10 players globally in the differential bevel gear market. It owns nine manufacturing and assembly facilities across India (6), China, Mexico and the US.
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