Diffusion Engineers IPO Day 3: GMP, subscription status, key dates, more. Should you subscribe or not?

Diffusion Engineers IPO: Diffusion Engineers Ltd’s initial public offering, which is scheduled to close its subscription today (Monday, September 30), has received positive responses across all its segments. Non-institutional investors have shown the most interest, closely followed by the retail portion. The company, involved in manufacturing welding consumables, wear plates, wear parts, and heavy engineering machinery for core industries, secured ₹47.14 crores from anchor investors before opening its initial public offering for public subscription on Thursday, September 26.

The price band for the issue has been set at ₹159 – ₹168 per equity share. At the upper end of the price range, the Diffusion Engineers IPO is expected to raise ₹158.00 crore. Investors have the option to bid for a minimum of 88 equity shares and in multiples of 88 equity shares thereafter.

The issue is being conducted through the book-building process, where 50% of the net issue will be available for allocation on a proportionate basis to qualified institutional buyers, 15% of the net issue will be available for allocation to non-institutional bidders, and 35% of the net issue will be available for allocation to retail individual bidders.

As per the red herring prospectus (RHP), the company’s listed peers are Ador Welding Ltd (with a P/E of 29.01), and AIA Engineering Ltd (with a P/E of 35.88).

Diffusion Engineers IPO allotment date is scheduled on Tuesday, October 1, and the company will initiate refunds on Thursday, October 3, while the shares will be credited to the demat account of allottees on the same day following refund. Diffusion Engineers IPO listing date is on Friday, October 4.

Diffusion Engineers IPO Subscription Status

The initial public offer of Diffusion Engineers IPO has been subscribed 27.19 times on the second day of subscription, as per BSE data.

The initial share sale received bids for 17,94,34,464 shares against 65,98,500 shares on offer, according to BSE data.

The portion for retail investors received 33.91 times subscription while the quota for non-institutional investors got subscribed 47.08 times. The qualified institutional buyers (QIBs) part is booked 28%, and the employee portion has been subscribed 36.64 times.

Diffusion Engineers IPO subscription status was 7.16 times on the first day.

Diffusion Engineers IPO Review

Canara Bank Securities

The brokerage claims that Diffusion Engineers has seen consistent financial growth. The firm recorded the third-highest compound annual growth rate (CAGR) of 21% in operating income, 38% in profit after tax between FY21 and FY24, and the third-highest CAGR of 33% in EBITDA among the industry participants taken into consideration between fiscal 2021 and FY24. For the aforementioned periods, the business recorded PAT margins of 8.17% (FY22), 8.56% (FY23), 10.79% (FY24), and RoCE margins of 17.30%, 18.46%, and 20.63%, respectively. With a P/E ratio of 15.36x, considerably less than the industry average of 32.86x, Diffusion Engineers looks to be well valued. For long-term benefits, the brokerage hence advises SUBSCRIBING to this issue.

Swastika Investmart Ltd

The brokerage claims that the firm works in an industry with large infrastructure and industrialisation investment that is promising. By prioritising forward integration and diversification, the organisation sets itself up for future expansion. shown improved margins and steady financial growth. Fairness is accorded to the P/E value of the IPO. In order to benefit from both possible listing profits and long-term value appreciation, investors could think about applying for the IPO.

Diffusion Engineers IPO details

Diffusion Engineers IPO consists entirely of a new issuance of 98.5 lakh equity shares. The funds raised from the offering will go towards expanding its current manufacturing facility and establishing a new one in Maharashtra.

Unistone Capital Pvt Ltd serves as the book running lead manager for the Diffusion Engineers IPO, and Bigshare Services Pvt Ltd has been appointed as the registrar for the issue.

Diffusion Engineers IPO GMP today

Diffusion Engineers IPO grey market price is + 58. This indicates Diffusion Engineers share price was trading at a premium of ₹58 in the grey market, according to investorgain.com

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Diffusion Engineers shares was ₹226 apiece, which is 34.52% higher than the IPO price of ₹168.

‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.d ((