The initial public offering IPO of Tega Industries was opened today. The firm plans to raise Rs 619.22 crore through the IPO at the upper end of the price band. The share sale has a price band of Rs 443 -- 453 per share.
On November 30, the manufacturer of consumables for the mining industry raised Rs 186 crore from anchor investors. According to a BSE circular, the company has decided to allocate 41 lakh equity shares to anchor investors at Rs 453 apiece, bringing the transaction size to Rs 185.76 crore.
BNP Paribas Arbitrage, Goldman Sachs Funds, Ashoka India Equity Investment Trust Plc, Kuber India Fund, SBI Mutual Fund MF ICICI Prudential MF, HDFC MF, Axis MF, Tata MF and Aditya Birla Sun Life MF are some of the anchor investors.
The initial public offering IPO is purely an offer for the sale of OFS of 1,36, 69,478 equity shares by promoters and existing shareholder. As part of the OFS, promoters Madan Mohan Mohanka and Manish Mohanka will offload 33.14 lakh and 6.63 lakh equity shares.
The IPO's lot size is 33 shares for which one will have to spend Rs 14,949. A retail investor can apply for up to 13 lots or 429 shares by spending Rs 1,94, 337.
The firm will make its debut on the BSE and NSE on December 8, 2021 and the allotment of shares will be finalised on December 8, 2021.
The purpose of the offer is to get the benefits of listing the equity shares on the stock exchanges.
Kolkata-based Tega Industries offers global clients a wide product portfolio, which includes mineral beneficiation, mining and bulk solids handling.
Religare Broking is a big fan of the IPO.
The company provides a wide range of products and solutions that are critical to different stages of mineral processing, and we believe that it is well placed across the value chain of mineral processing. The company intends to gain market share, increase penetration in North America, South America, Australia and South Africa in the long term, as well as strong R&D and a track record of developing innovative product portfolio and marquee global customers are key positives for the company, Religare Broking said.
ICICI Securities has assigned a'subscribe' rating to the IPO.
Tega's strong market position, innovative products, and higher entry barriers are likely to help maintain its margins while consistent growth of high repeat business 74% would augur well in the long run. The brokerage said it is valued at 22 times P E for FY 21, at the upper end of the price band.
The company has a P E of 22.02 with a market cap of Rs 30,031 mn, while its rival, AIA Engineering Ltd, is trading at a P E of 30.40, based on the FY 21 adjusted earnings per share of Rs 20.58 on a post-issue basis. It is available at a reasonable valuation as compared to its peer, according to the brokerage.