Shares of DEE Development Engineers are set to make its debut at Dalal Street on Wednesday and the stock is likely to deliver a strong listing pop to the investors on listing, if one goes by the existing signals based on the grey market premium (GMP) for the piping solutions company.
Ahead of its listing, shares of DEE Development Engineers were commanding a premium of Rs 98-100 in the grey market, suggesting a listing pop of 48-50 per cent over its issue price of Rs 203 per share. However, the grey market premium stood around Rs 90 apiece at the closure of the issue on Friday.
DEE Development Engineers, a leading player in the niche and high-barrier Indian process piping solutions industry, is set for a spectacular stock market debut. The IPO has garnered immense investor interest and generated a sky-high GMP. This overwhelming demand paints a very positive picture for DEE's listing, said Shivani Nyati, Head of Wealth, Swastika Investmart.
"DEE boasts a strong competitive edge, with established client relationships and a diverse portfolio of specialized offerings. The company further enjoys a robust order book and a track record of consistent financial performance. These factors contribute to the anticipated strong listing and potential for further growth," she said.
The IPO of DEE Development Engineers was open for bidding June 19 and June 21. The company had offered its shares in the fixed price band of Rs 193-203 per share with a lot size of 73 shares. The company raised a little more than Rs 418.01 crore via its primary offering, which included a fresh share sale of Rs 325 crore and an offer-for-sale (OFS) of up to 45,82,000 equity shares.
The issue was overall subscribed a stellar 99.56 times. The quota for qualified institutional bidders (QIBs) was booked a whopping 201.91 times The quota for non-institutional investors was subscribed 144 times. The portions reserved for retail investors and employees saw bidding for 23.42 times and 44.73 times, respectively during the three-day bidding process.
The company is set to list at a premium of around 47 per cent premium. The company has evolved as one of the key players in process piping solutions in India, with a strong focus on automation and process excellence to drive operational efficiencies and offerings to its customers, said Prathamesh P Masdekar, Research Analyst at StoxBox.
"As we advance, the company's financial performance is likely to be driven by its robust balance sheet, long-standing customer relationships, capacity expansion, higher entry barriers, and strong management team with impressive backgrounds. Hence, we advise the market participants allotted the shares to hold them for a medium to long term," he said.
Founded in 1988, Faridabad-based DEE Development Engineers is an engineering company that provides specialized process piping solutions for oil and gas, power including nuclear, chemicals, and other process industries through engineering, procurement, and manufacturing, among others.
Brokerage firms were mostly positive on the issue, suggesting investors to subscribe to it. Equirus Capital and SBI Capital Markets are the book running lead managers of the DEE Piping Systems IPO, while Link Intime India is the registrar for the issue.