Indo Farm Equipment Limited’s initial public offering (IPO), the final public issue of 2024, opens for bidding on Tuesday. The IPO is expected to generate significant interest among investors due to the company’s established presence in the agriculture and construction equipment sectors.
About Indo Farm Equipment Limited
Founded in 1994, Indo Farm Equipment Limited is a leading manufacturer of agricultural and construction equipment. The company produces a range of products, including tractors, pick-and-carry cranes, rotavators, combine harvesters, and other specialized machinery. Its product portfolio caters to the needs of farmers and construction operators, making it a crucial player in these industries.
The company operates under two main brands: Indo Farm and Indo Power. It serves both domestic and international markets, exporting its products to countries like Nepal, Syria, Sudan, Bangladesh, and Myanmar. Indo Farm is recognized for its commitment to quality, durability, and innovation in its product offerings.
IPO Details
The IPO is a book-built issue aiming to raise a total of ₹260.15 crore. The issue consists of:
- A fresh issuance of 86 lakh equity shares worth ₹184.90 crore.
- An offer for sale (OFS) of 35 lakh shares, amounting to ₹75.25 crore.
The price band for the IPO has been set between ₹204 and ₹215 per share.
Investor Participation
Retail investors can participate in the IPO by applying for a minimum of one lot, which includes 69 shares and costs ₹14,835.
- Small non-institutional investors (sNII) must apply for at least 14 lots (966 shares), requiring an investment of ₹2,07,690.
- Large non-institutional investors (bNII) need to apply for at least 68 lots (4,692 shares), with an investment of ₹10,08,780.
Aryaman Financial Services Limited is acting as the book-running lead manager for the IPO, while Mas Services Limited is the registrar.
Use of IPO Proceeds
Indo Farm plans to utilize the funds raised from the IPO for the following purposes:
- Expansion of Production Capacity: A significant portion of the funds will be used to increase the manufacturing capacity of its pick-and-carry cranes, addressing rising demand in the construction sector.
- Debt Repayment: The company will repay select loans to strengthen its financial position.
- Investment in Subsidiary: A portion of the proceeds will be invested in Barota Finance, the company’s non-banking financial company (NBFC) subsidiary, to support its growth.
- General Corporate Purposes: The remaining funds will be allocated for operational and corporate expenses.
Grey Market Premium (GMP)
The grey market premium (GMP) for the IPO currently stands at ₹80, indicating strong market demand. Based on this, the shares are expected to list at approximately ₹295, offering a potential gain of around 37.21% over the upper price band of ₹215.
Growth and Market Presence
Indo Farm has been steadily expanding its footprint in both the agriculture and construction equipment industries. The company leverages its extensive product portfolio and robust distribution network to cater to a wide customer base. Its focus on innovation and quality has helped it build a strong reputation among farmers and industrial clients alike.
Key Dates
- Share Allotment: January 3, 2025.
- Listing on Stock Exchanges (BSE & NSE): January 7, 2025.
With its diverse product offerings and plans for expansion, Indo Farm Equipment Limited is well-positioned to capitalize on the growing demand for agricultural and construction equipment in both domestic and international markets. Investors eyeing the IPO have a promising opportunity to participate in the company’s growth story.