Lakshya Powertech IPO Sees Massive Subscription on Second Day

The initial public offering (IPO) of Lakshya Powertech Limited, a company specializing in power generation consultancy and services, has garnered substantial attention from investors, achieving an overwhelming subscription rate by the end of its second day. This significant investor interest was recorded on October 17, 2024, just a day after the IPO opened for public subscription.

According to market data, the IPO, which seeks to raise ₹49.91 crore, was subscribed approximately 167 times by the end of the second bidding day. Retail investors showcased the highest level of interest, subscribing 252.91 times their allotted shares, while non-institutional investors subscribed 206.32 times. Qualified institutional buyers also participated, although to a lesser extent, subscribing 12.78 times.

The company is offering 27.73 lakh shares through this SME IPO, setting a price band between ₹171 and ₹180 per equity share. The grey market premium (GMP) indicates that shares might list at a significant premium of around 96%, suggesting a potential listing price of ₹352 per share.

Lakshya Powertech, in its business strategy, plans to utilize the funds raised through the IPO for several key purposes. The company intends to allocate approximately ₹30 crore towards working capital requirements, ₹4.5 crore for debt repayment, and the remaining amount for general corporate purposes. The firm’s business operations span engineering, procurement, construction, and commissioning (EPCC) services.

Throughout its operational history, Lakshya Powertech has executed over 138 projects, with major completed projects valued at ₹268.43 crore. As of August 2024, the company is involved in 45 ongoing projects with a total worth of ₹431.99 crore.

In terms of financial performance, Lakshya Powertech reported significant profit growth over the past three fiscal years, with the profit after tax reaching ₹1,567.77 lakh in the most recent fiscal year of FY24.

Market observers noted a robust grey market activity surrounding the IPO shares, which were trading at a premium of 90-95% over the upper price band. This unofficial market activity reflects investor confidence in the company’s prospects post-IPO.

GYR Capital Advisors Private Limited is serving as the book-running lead manager for the IPO, while Kfin Technologies Limited is the registrar. The shares are expected to be listed on the NSE SME platform on October 23, 2024.