The initial public offering (IPO) of Admach Systems Limited, which opened for subscription on Monday, December 23, has received a notably subdued response from the investor community on its first day. As of 5:00 PM, the public issue was subscribed a mere 0.03 times, with bids received for only 51,000 equity shares against the total offer size of 14.82 lakh shares.
Segment-Wise Subscription Details Reveal Weak Demand
A closer look at the subscription data reveals a broad lack of enthusiasm across investor categories. The portion reserved for non-institutional investors (NIIs) saw an even weaker response, subscribed only 0.01 times. The retail investor segment fared slightly better but remained low, with a subscription rate of 0.06 times. Notably, the Qualified Institutional Buyer (QIB) category had not yet opened for bidding as of the end of the first day, according to the latest exchange data.
Key Details of the Admach Systems Public Offer
The company is looking to raise ₹42.60 crore through this fresh issue of 18 lakh shares. The IPO price band has been fixed between ₹227 and ₹239 per equity share. For retail investors, the minimum investment is substantial, with a lot size of 1,200 shares requiring an application amount of approximately ₹2.86 lakh.
The allocation of shares is as follows:
- 592,200 shares are reserved for Qualified Institutional Buyers (QIBs).
- 379,800 shares are set aside for Non-Institutional Investors.
- 721,200 shares are earmarked for Retail Investors.
The company has stated that the net proceeds from the issue will be utilized to meet its working capital requirements and for general corporate purposes.
Listing Timeline, GMP, and Company Background
The subscription window for the IPO will remain open until Thursday, December 26. The basis of allotment is scheduled for Monday, December 29. Successful allottees can expect the shares to be credited to their demat accounts by Tuesday, December 30, with refunds also being processed on the same day for unsuccessful applicants. The shares are proposed to be listed on the BSE SME platform on Wednesday, December 31.
In a concerning sign for listing gains, the unofficial grey market premium (GMP) for the Admach Systems IPO was reported as nil prior to the opening. This suggests the stock could list at its issue price or potentially at a discount.
Aftertrade Broking Pvt. Ltd. is acting as the book-running lead manager for the issue, while Maashitla Securities Pvt. Ltd. is the registrar. The market makers are NNM Securities Pvt. Ltd. and Aftertrade Broking Pvt. Ltd.
Admach Systems is engaged in the business of designing, manufacturing, exporting, and supplying customized special-purpose machines and automation systems. Its products serve a range of industries including steel, automobile, food processing, tooling, and other engineering sectors.
The tepid initial demand underscores the cautious mood among investors towards the SME segment and highlights the importance of thorough due diligence. Investors are advised to carefully assess the company's fundamentals and prospects before considering an investment.
