Strong Listing: Indo Farm Equipment Shares Make Healthy Debut, List At 20% Premium From IPO Price

Indo Farm Equipment shares began their market journey on a positive note, listing at Rs 256 on the NSE, reflecting a premium of 19% over the issue price of Rs 215, on Friday, January 3. On the BSE, the stock listed slightly higher at Rs 258.40, marking a 20.19% premium. This strong debut follows the overwhelming response to the company's Rs 260.15-crore IPO.

IPO Subscription Details

The Indo Farm Equipment IPO, open for bidding from December 31 to January 2, was a massive success, witnessing an overall subscription of 227.67 times. The issue received bids for 192.83 crore shares against the 84.70 lakh shares available. Retail Investors subscribed 101.79 times, Non-Institutional Investors (NII) subscribed 501.75 times, and Qualified Institutional Buyers (QIBs) subscribed 242.4 times.

The IPO's price band was set at Rs 204-215 per equity share, with retail investors allowed to bid in lots of 69 shares, requiring a minimum investment of Rs 14,835.

IPO Structure

The IPO comprised a fresh issue of 0.86 crore shares amounting to Rs 184.90 crore and an offer for sale (OFS) of 0.35 crore shares valued at Rs 75.25 crore. Post-IPO, the promoters' stake in the company reduced from 93.45% to 69.44%.

The company also raised Rs 78.05 crore from anchor investors on December 30, 2024, a day before the IPO opened for subscription.

Objectives of the IPO

The net proceeds from the fresh issue aim to achieve the following:
Capacity Expansion: Setting up a dedicated unit to enhance the production of pick-and-carry cranes.
Debt Reduction: Repayment or prepayment of specific borrowings.
Capital Infusion: Strengthening the capital base of Barota Finance Ltd., the company's NBFC subsidiary.
General Corporate Purposes: Allocation of funds for day-to-day operational needs.
Aryaman Financial Services Limited acted as the book-running lead manager for the IPO, with Mas Services Limited serving as the registrar.

About Indo Farm Equipment

Established in 1994 and headquartered in Chandigarh, Indo Farm Equipment is a leading manufacturer of agricultural and industrial machinery. The company produces tractors, pick-and-carry cranes, and harvesting equipment under its brands Indo Farm and Indo Power.

The company's state-of-the-art facility in Baddi, Himachal Pradesh, spans 1,27,840 square meters and includes a foundry, machine shop, and assembly lines. This facility boasts an annual production capacity of 12,000 tractors and 1,280 pick-and-carry cranes. Indo Farm's tractors range from 16 HP to 110 HP, while its cranes have a lifting capacity of 9 to 30 tons.

Financial Performance

For the fiscal year ending March 31, 2024, Indo Farm Equipment reported a modest 1% growth in both revenue and profit after tax (PAT). Indo Farm Equipment exports its products to multiple international markets, including Nepal, Syria, Sudan, Bangladesh, and Myanmar.