Gala Precision Engineering IPO Opens for Public Subscription with Strong Market Sentiment

The initial public offering (IPO) of Gala Precision Engineering, a manufacturer of precision components, has commenced for public subscription today. The IPO is a book-built issue that seeks to raise Rs 167.93 crore by offering a fresh issue of 2,558,416 equity shares, alongside an offer for sale of 616,000 shares, each with a face value of Rs 10.

Prior to this public issue, Gala Precision Engineering successfully raised Rs 50.29 crore from anchor investors in a bidding process that concluded on August 30, 2024.

The subscription window for this IPO will remain open for three days, available at a price range of Rs 503-529, with a minimum lot size of 28 shares. For retail investors, the minimum amount required to bid is Rs 14,812.

Once the subscription period ends, the allotment of shares is expected on September 5, 2024, and the shares will be credited to demat accounts by September 6, 2024. The official listing of Gala Precision Engineering shares is scheduled for September 9, 2024, on both the BSE and NSE.

The book-running lead manager for the IPO is PL Capital Markets, while Link Intime India serves as the registrar for the issue.

In addition to the excitement around the IPO, the grey market has reported a significant premium on Gala Precision Engineering shares on the first day of opening. They are currently trading at a premium of Rs 240, which represents a rise of 45.37% compared to the upper end of the issue price.

The IPO aims to utilize the net proceeds for various strategic purposes, including establishing a new manufacturing facility in Vallam-Vadagal, Tamil Nadu for fastener production, purchasing equipment and machinery in Wada, Maharashtra, repaying or prepaying existing debts, and for general corporate purposes.

Several brokerage firms, including Deven Choksi Research, Swastika Investmart, and Anand Rathi Research, have expressed positive sentiments regarding the IPO. They recommend that investors consider subscribing to the Gala Precision Engineering public issue, citing its favourable positioning within the precision components industry.

Analysts at Deven Choksi Research noted that the company’s growth potential is enhanced by its strategic advantages in a thriving market characterized by strong demand in sectors such as renewable energy and automotive.”