Harsha Engineers IPO: What GMP signals after strong subscription?


Harsha Engineers IPO: After three days subscription of the public issue worth 755 crore, Harsha Engineers IPO subscription status reflects that the issue has received strong response from investors. Despite weakness in stock market sentiments, the public issue got subscribed 74.70 times whereas its retail portion got subscribed 17.63 times. The initial public offer (IPO) has been subscribed 71.32 times in NII category while QIB portion has ben subscribed 178.26 times. Meanwhile, after strong response from investors, grey market has also gone bullish on Harsha Engineers shares. According to market observers, shares of Harsha Engineers are available at a premium of 235 in grey market today.

Harsha Engineers IPO GMP today

Market observers said that Harsha Engineers IPO GMP (grey market premium) today is 235, which is 5 higher from its Friday GMP of 230. They said that the jump may look small but the way bloodbath was witnessed on Dalal Street on Friday session, this rise is heart warming. They said that grey market premium of Harsha Engineers IPO has been continuously rising since the opening of subscription. In last four days, Harsha Engineers IPO GMP has risen from around 200 to 235 and primary reason for this rise in GMP can be attributed to the strong response by investors.

What this GMP mean?

Market observers said that Harsha Engineers IPO GMP today is 235, which means grey market is expecting that the public issue will list at around 565 ( 330 + 235), which is around 70 per cent higher from its price band of 314 to 330 per equity share. They said that grey market is signaling that the public issue may list at around 70 per cent premium on its listing date, which is most likely on 26th September 2022.

However, stock market observers maintained that grey market sentiments can be artificial as it involves even those who have high stake involved in the public issue. They said that GMP of a public issue has nothing to do with its financials and hence it should not be relied with blind eyes. They advised investors to go with the basics and fish out the balance sheet of the company as it would give clear and concrete picture about the fundamentals of the company.

Highlighting the fundamentals of Harsha Engineers International Limited, Angel One report says, “In terms of valuations, the post-issue P/E works out to 32.7x FY22 EPS (at the upper end of the issue price band). Company’s consolidated PAT has grown at CAGR of ~105% over FY20-22 on back of margin expansion. HEIL has diverse product portfolio and strong expertise; we believe that these positives are yet to be factored in the valuations commanded by the company.”

Harsha Engineers IPO details

The tentative date for Harsha Engineers IPO allotment date is 21st September 2022. The public issue is proposed for listing on both NSE and BSE and the likely date for share listing is 26th September 2022.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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