Deepak Builders & Engineers IPO: Public Issue Fully Subscribed On Day 1, GMP Hints Strong Listing; Check

Deepak Builders and Engineers India Limited, a Punjab-based firm, opened its subscription for IPO on October 21, 2024. This initial public offering (IPO) aims to attract significant investment and raise capital for the company's future projects. The IPO follows a successful anchor book round, where Deepak Builders secured Rs 78.01 crore from five institutional investors on October 18.

Among the institutional investors, Neomile Growth Fund emerged as the largest stakeholder, acquiring 14.77 lakh shares worth Rs 30 crore. Citadel Capital Fund followed closely, purchasing 9.85 lakh shares for Rs 20 crore. Other investors included Saint Capital Fund, Zeal Global Opportunities Fund, and Elite Capital Fund, collectively investing Rs 28 crore for 13.8 lakh shares.

IPO Pricing and Subscription Details

The IPO price band has been set between Rs 192 and Rs 203 per equity share, with a face value of Rs 10. The subscription period is open from October 21 to October 23. The IPO is structured to allocate shares across different investor categories: up to 50% of shares are reserved for Qualified Institutional Buyers (QIBs), at least 15% for Non-Institutional Investors (NIIs), and a minimum of 35% for retail investors.

As of 11:50 am on the first day of bidding, the Deepak Builders and Engineers IPO has shown robust demand, being fully subscribed overall at 1.26 times. The initial share sale received bids for 1,12,94,268 shares against the total offer of 89,67,061 shares, according to the Bombay Stock Exchange (BSE) data. The retail investor segment has already been subscribed 2.14 times, while the NII portion stands at 92%. The QIB portion is yet to be subscribed.

About Deepak Builders and Engineers

Deepak Builders and Engineers India Limited was founded in September 2017. The company specializes in constructing a variety of structures, including administrative buildings, hospitals, stadiums, residential complexes, and more. Deepak Builders has successfully managed comprehensive turnkey projects, overseeing architectural design, structural engineering, civil works, mechanical, electrical, and plumbing (MEP) systems, firefighting services, public health systems, IT infrastructure, operating theatres, medical gas pipelines, and landscaping.

IPO Structure and Grey Market Performance

The IPO will consist of 1.07 crore new equity shares, along with an additional 21.1 lakh shares offered through an Offer for Sale (OFS) by promoters Deepak Kumar Singal and his partner, who currently own nearly 100% of the company. Fedex Securities Pvt Ltd is the book-running lead manager for this IPO, while Kfin Technologies Ltd serves as the registrar.

In the grey market, Deepak Builders and Engineers shares are trading at a premium of Rs 60. According to estimates, the anticipated listing price could be around Rs 263 per share, representing a 29.56% increase over the upper end of the IPO price band. The grey market premium reflects the willingness of investors to pay more than the issue price, suggesting a positive outlook for the stock's performance post-listing.

As the Deepak Builders and Engineers IPO opens for subscription, investor interest appears to be on the rise, buoyed by robust institutional backing and favourable market conditions. With the IPO subscription period running until October 23, 2024, potential investors can invest in Deepak Builders and Engineers. As the construction industry continues to expand, fueled by government initiatives and infrastructural demands, this IPO could represent a significant step forward for the company and its investors alike.