Overview of Diffusion Engineers IPO
The Diffusion Engineers Initial Public Offering (IPO), which aims to raise ₹158.00 crore, is witnessing a strong response from investors. Within just two days, the IPO has been oversubscribed by more than 27 times, indicating robust interest, particularly from retail investors. Their reserved portion has been filled more than 33 times, showcasing the IPO’s popularity in the market. Investors still have one day left to participate in this offering.
Current Market Sentiment
In the gray market, shares of Diffusion Engineers are trading at a premium of ₹64, reflecting a Gray Market Premium (GMP) of 38.1% over the upper price band of the IPO. However, financial experts advise investors to base their decisions on the company’s overall business health rather than solely on gray market signals.
Category-wise Subscription Details
| Investor Category | Subscription Rate |
|---|---|
| Qualified Institutional Buyers (QIB) | 0.28 times |
| Non-Institutional Investors (NII) | 47.08 times |
| Retail Investors | 33.91 times |
| Employees | 36.64 times |
| Total Subscription | 27.19 times |
IPO Offerings and Key Dates
The IPO is priced within the range of ₹159-₹168 per share, with an investment lot size set at 88 shares. Additionally, employees can avail of a ₹8 discount on each share. The subscription for the IPO will close on September 30, with the share allotment scheduled for October 1, and the listing expected on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on October 4. A total of 94.05 lakh new shares are being issued under this IPO, with a face value of ₹10 per share.
Purpose of Fundraising
The funds raised through this IPO will be allocated towards various corporate purposes, including the expansion of existing manufacturing facilities, the establishment of new manufacturing units, and fulfilling working capital requirements.
Company Background
Diffusion Engineers, established in 1982, specializes in manufacturing welding consumables, wear plates, and heavy machinery. The company operates four manufacturing units, primarily located in the Nagpur Industrial Area. In terms of financial performance, Diffusion Engineers has shown consistent growth, reporting a net profit of ₹17.05 crore in FY 2022, escalating to ₹22.15 crore in FY 2023, and reaching ₹30.8 crore in FY 2024. During this period, the company achieved a compound annual growth rate (CAGR) of approximately 17% in revenue, totaling ₹285.56 crore.
Conclusion
The overwhelming interest in the Diffusion Engineers IPO reflects the broader market optimism and the company’s solid financial standing. Investors are encouraged to consider both the potential for short-term gains and the long-term viability of the company’s business model when making their investment decisions.
