Esconet Tech IPO Day 3: Issue subscribed over 471 times; latest GMP & other details

The initial public offering (IPO) of Esconet Technologies Ltd has continued to garner a massive demand from investors on the final day of bidding process. The three-day SME IPO -- which began for subscription on February 16 -- closed today. On Day 3, the initial share sale was subscribed 471.18 times. The issue saw 1,13,38,36,800 bids as against a total issue size of 24,06,400.

The price band was fixed in the range of Rs 80 to Rs 84 apiece for a lot size of 1,600 equity shares. The company plans to raise around Rs 28.22 crore (at upper band) from the offering and aims to be listed with NSE Emerge.

Grey market premium (GMP)

In the grey market, Esconet Tech shares were last seen trading at a premium of over 101 per cent against its issue price of Rs 84 (upper price band). The stock is likely to get listed on February 23, 2024.

Brokerage view

ProfitMart Securities said, "After the proposed IPO, the company's net worth will total Rs 33.88 crore. And, equity capital will stand at Rs 12.36 crore. We are confident that Esconet Tech will deliver consistent performance and provide an excellent investment opportunity for investors with a long-term horizon."

Earnings

As per Esconet's consolidated financial statements, revenue from operations stood at Rs 71.41 crore during the first half of the current fiscal year, which ended September 30, 2023 (H1 FY24), compared to an operating revenue of Rs 96.59 crore in the year-ago fiscal. During the mentioned period, it earned a profit after tax of Rs 3.05 crore as against Rs 3.18 crore in H1 FY23.

It also underscored that a significant portion of the company's revenue in the last three years was generated from government projects. On February 1, Esconet said it has secured orders worth Rs 9 crore from the National Informatics Centre Services Inc (NICSI), a Ministry of Electronics & Information Technology (MeitY) agency and CE Info Systems (MapMyIndia).

The company manufactures supercomputers, high-end servers, workstations and storage systems under its brand, HexaData, catering to the domestic market. It also specialises in high-capacity and high-throughput data storage solutions built on parallel file systems.

Corporate Capital Ventures has been appointed as the book-running lead manager to the issue and Skyline Financial Services Pvt Ltd is the registrar.

(Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.)

Also read | Hot stocks on February 20: YES Bank, Coal India, Deepak Fertilisers, Allcargo Logistics and more

Also read | Vibhor Steel Tubes shares end 195% higher on listing day; should you hold or book profit?