Bumper Listing: Exicom Tele-Systems Debuts At 87% Premium From IPO Price On Exchanges; Buy Or Not?

On March 5, Exicom Tele-Systems, the Gurugram-based EV charger manufacturer, made its debut on the stock exchanges and soared to Rs 265 per share on the bourses, commanding an 87% premium over its issue price of Rs 142 per share.

The initial public offering (IPO) aimed to raise Rs 429 crore, comprising a fresh issue of Rs 329 crore and an offer-for-sale (OFS) of 70.42 lakh shares worth Rs 100 crore at the upper price band. The OFS sees Promoter NextWave Communication divesting its shares.

Investors displayed overwhelming confidence in Exicom, as the IPO garnered a robust subscription of 129.54 times on the final day of bidding, February 29. High net worth individuals led the charge with a subscription rate of 153.22 times, closely followed by retail investors at 119.58 times, and qualified institutional buyers at 121.80 times their allotted quota.

Exicom Tele-Systems operates as a power management solutions provider, focusing on two key business verticals. In the EV chargers business, the company provides intelligent charging systems catering to residential, business, and public charging applications across India. Simultaneously, in the critical power solutions sector, Exicom specializes in the design, manufacturing, and servicing of critical digital infrastructure technology.

The company, an early entrant in the EV chargers manufacturing segment, boasts a substantial market share, holding 60% and 25% in the residential and public charging segments, respectively, as of March 31, 2023. Notably, Exicom has deployed over 35,000 EV chargers across 400 locations in India.

Of the fresh proceeds from the IPO, Exicom has outlined a strategic allocation plan. A chunk, amounting to Rs 145.77 crore, is earmarked for establishing production and assembly lines at a manufacturing facility in Telangana. Additionally, Rs 69 crore will be allocated to meet working capital requirements, while Rs 40 crore is designated for investment in research and development (R&D) and product development. Another crucial aspect involves the allocation of Rs 50.3 crore for debt repayment, demonstrating the company's commitment to financial prudence. The remaining balance will be utilized for general corporate purposes, providing flexibility for future growth initiatives.

Exicom's successful IPO and subsequent listing at a premium underscore the investor community's confidence in the company's growth potential and its pivotal role in the transition towards electric mobility in India. Investors, both institutional and retail, are now closely watching the company's performance as it takes on the opportunities and challenges in the dynamic and rapidly evolving EV ecosystem.