Paras Defense IPO: Investors heavily invested in the IPO of Paras Defense and Space Technology. The company’s issue has been subscribed 304.26 times so far on the third day. The bidding is for 217.26 crore equity shares in lieu of 71.40 lakh shares of the company. According to the company’s upper price band of Rs 175, bids of Rs 38,000 crore have been received.
The reserve portion for retail investors has attracted 112.81 times the bidding. Whereas Non-Institutional Investors (NIIs or HNIs) have bid 927.70 times their share. The reserve portion for Qualified Institutional Buyers (QIBs) has subscribed 169.65 times.
The company is raising Rs 179.77 crore from IPO. The company has already raised Rs 51.23 crore from anchor investors.
Great acceleration in GMP?
The price band for the issue of Paras Defense is Rs 165-175. Accordingly, the unlisted shares of the company are trading at Rs 415 (175 + 240) in the gray market. That is, it is trading 135% above its upper price band.
What is the reason for the strong boom?
According to market experts, it is being liked due to the small issue size, reasonable valuation and the government’s focus on the defense sector. Experts say that it is clear from the strong GMP that the listing of Paras Defense shares is going to be tremendous.
Akhil Rathi of Marwari Shares says that due to the small size, there was a strong response on the first day of the IPO. The company provides a wide range of products and solutions to the defense and space sectors. The company will further benefit from self-reliant India and Make in India. The valuation of the company is also very attractive. Its market cap is Rs 682.5 crore.
Long term investors can expect good returns from this investment. As of June 2021, the company has orders worth around Rs 305 crore. Due to which good growth is expected in its income. Paras Defense has a wide range of products and has a good list of good customers. This will give good benefits to the company going forward.