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Ajax Engineering IPO Day 1 GMP: Unlisted shares of Ajax Engineering Ltd are currently trading at Rs 660 apiece in the grey market, which is a 4.93 per cent premium over the upper IPO price of Rs 629.
Most brokerage firms have granted a ‘subscribe’ rating to the Ajax Engineering IPO.
Ajax Engineering IPO Grey Market Premium: The initial public offer of Kedaara Capital-backed concrete equipment manufacturer Ajax Engineering Ltd (AEL) has been opened for public subscription on Monday. It will conclude on Wednesday. The price band of the IPO has been fixed at Rs 599 to Rs 629. Till 5:04 pm on the first day of bidding, the Rs 1,269.35-crore IPO received a 0.28 times subscription, garnering bids for 39,83,324 shares as against 1,41,49,997 shares on offer.
So far, the retail category has been subscribed by 0.29 times subscription, while the NII has got a 0.28 times subscription. The QIB category received a 0.26 times subscription.
After the IPO closes on Wednesday, its share allotment will be finalised on February 13 (Thursday) and its listing will take place on both BSE and NSE on February 17.
Ajax Engineering IPO Price & Lot Size
The price band is set at Rs 599 to Rs 629 per share, while the minimum lot size for an application is 23.
The minimum amount of investment required by retail investors is Rs 14,467. The minimum lot size investment for small NII is 14 lots (322 shares), amounting to Rs 2,02,538, and for big NII, it is 70 lots (1,610 shares), amounting to Rs 10,12,690.
Ajax Engineering IPO GMP Today
According to market observers, unlisted shares of Ajax Engineering Ltd are currently trading at Rs 660 apiece in the grey market, which is a 4.93 per cent premium over the upper IPO price of Rs 629. It indicates a weak listing for investors on February 17.
The GMP is based on market sentiments and keeps changing. ‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
Ajax Engineering IPO: Should You Apply?
Most brokerage firms have granted a ‘subscribe’ rating to the IPO.
BP Equities – Subscribe
Granting a ‘subscribe’ rating to the Ajax Engineering IPO, brokerage firm BP Equities has said the concrete equipment market in India, particularly for SLCMs, is experiencing significant growth driven by several factors, including increasing cement consumption and rising public and private capital expenditure in infrastructure, irrigation, housing, and renewable power projects, leading to higher demand for construction materials and equipment.
It added that Ajax Engineering has established a robust dealer-led distribution and service model, comprising 51 dealers across 23 states, and serves a diverse base of end customers across specialised sectors such as transportation infrastructure, irrigation, and large-scale infrastructure projects.
On the financial front, BP Equities stated, “The company has delivered strong performance, with revenue growing at a CAGR of 51 per cent from FY22 to FY24. During the same period, its Ebitda and PAT grew at an impressive CAGR of 74.5 per cent and 84.4 per cent, respectively.”
On the valuation, it said, “The issue is priced at a P/E ratio of 32.1x at the upper price band based on FY24 earnings, which is comparatively lower than its industry peers. Given the company’s strong financial performance, favorable industry growth drivers, and attractive valuation, we recommend a ‘Subscribe’ rating for this issue.”
KR Choksey – Subscribe
Brokerage firm KR Choksey in its IPO note has also assigned a Subscribe rating to the public offering. It said AEL is reasonably priced compared to its industry peers, backed by solid financial performance with a Revenue/PAT CAGR of 51 per cent/84 per cent from FY22 to FY24.
“With its dominant market share, growth trajectory, and favorable industry outlook, the company presents a compelling investment opportunity. Hence, we assign a ‘SUBSCRIBE’ rating,” said the brokerage in its research note.
Reliance Securities – Subscribe
Analysts at Reliance Securities have also recommended that investors subscribe to the Ajax Engineering IPO. Ajax Engineering (AEL), analysts said, has a first-mover advantage with the introduction of SLCMs in India, driven by the high quality and reliability of its products and strong after-sales service. “AEL has strengthened its capabilities and increased its market share of non-SLCM products, while also expanding its presence in overseas markets through exports and exploring opportunities for inorganic growth. With strong financials focusing on capital efficiency and healthy return ratios, the company is supported by an experienced management team and qualified personnel.”
Analysts believe AEL will continue to maintain its leadership in the large and growing SLCM market, as well as in the concrete equipment and application sectors, completing the value chain and delivering to a diversified customer base.
Ajax Engineering IPO: More Details
The initial public offering (IPO) is a complete offer-for-sale (OFS) of 2.01 crore shares, valued at Rs 1,269 crore at the top of the price range, by its promoters and an investor shareholder.
As part of the OFS, Kedaara Capital will offload 74.37 lakh shares.
Since the public issue is completely an OFS, Ajax Engineering will not receive any proceeds from the IPO.
The company’s market capitalisation has been pegged at Rs 7,200 crore at the upper end of the price band.
Ahead of the IPO, Ajax Engineering mobilised over Rs 379 crore from anchor investors, days before its initial share-sale opening for public subscription.
Ajax Engineering is a leading concrete equipment manufacturer with a comprehensive range of related equipment, services and solutions across the concrete application value chain. The company operates four assembling and manufacturing facilities in Karnataka, each specializing in distinct product lines. Besides, an assembling and manufacturing facility at Adinarayanahosahalli, Karnataka is under construction and expected to become operational in August 2025.
Ajax Engineering reported its FY24 revenue from operations at Rs 1,741 crore with a profit after tax (PAT) of Rs 225 crore.
ICICI Securities, Citigroup Global Markets India, JM Financial, Nuvama Wealth Management and SBI Capital Markets are the book running lead managers to the issue.
