Paras Defence IPO: Opens today; Key details investors should know before investing

Paras Defence IPO: Paras Defence and Space Technologies Limited's Initial Public Offering (IPO) will open for subscription today, i.e., Tuesday, September 21, 2021. It will close on Thursday, September 23, 2021.

The price band for the public issue has been fixed at Rs 165-175 per share. At the upper end of the price band, the IPO is expected to fetch Rs 170.7 crore. Investors can bid for a minimum of 85 equity shares and in multiples of 85 equity shares thereafter. Retail investors can apply for a single lot of shares by putting in Rs 14,875 and a maximum of 13 lots for Rs 1,93,375.

The IPO comprises fresh issuance of shares worth Rs 140.6 crore and an offer of sale (OFS) of up to 17,24,490 equity stocks by promoters and existing shareholders. Those selling shares on the OFS are promoters-- Sharad Virji Shah, Munjal Sharad Shah and individual selling shareholders are -- Munjal Shah, Shilpa Amit Mahajan and Amit Navin Mahajan.

The proceeds of the fresh issue would be used for the purchase of machinery and equipment, funding incremental working capital requirements, repaying or prepayment of certain borrowings, and general corporate purposes.

Half of the issue size has been reserved for qualified institutional buyers (QIBs), 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors.

Besides, Paras Defence and Space Technologies on Monday said it has garnered a little over Rs 51 crore from anchor investors, ahead of its initial public offering (IPO) from Tuesday. The company has allotted 29,27,485 equity shares to anchor investors at Rs 175 apiece, valuing the transaction at Rs 51.23 crore. Ashoka India Equity Investment Trust Plc, Abakkus Emerging Opportunities Fund-1, Saint Capital Fund, Nippon India Mutual Fund and HDFC Mutual Fund participated in the anchor book.

The share allotment of the Mumbai-based defence company is likely to take place on September 28, 2021, while the refunds would be initiated on September 29, 2021. The equity shares will be credited into the DEMAT accounts of allottees on September 30, 2021. The shares are expected to be listed on October 1, 2021.

Anand Rathi Advisors is the book running lead manager to the issue. The equity shares of the company would be listed on BSE and NSE.

Paras Defence and Space Technologies Limited is an Indian private sector company engaged in designing, developing, manufacturing and testing a wide range of defence and space engineering products and solutions. It is one of the leading 'Indigenously Designed Developed and Manufactured' category private sector companies in India, which caters to four major segments of the Indian defence sector, i.e., defence and space optics, defence electronics, electro-magnetic pulse protection solution and heavy engineering. We are also the sole Indian supplier of critical imaging components such as large size optics and diffractive gratings for space applications in India. (Source F&S Report)

Paras Defence has two manufacturing facilities in Maharashtra, located at Ambernath in Thane, Maharashtra and Nerul in Navi Mumbai, Maharashtra. Its R&D activities are mainly undertaken at our centres at Nerul in Navi Mumbai, Maharashtra and Bengaluru, Karnataka. Its Ambernath facility is engaged in the manufacturing of heavy engineering products, its Nerul facility is engaged in the manufacturing of optics, manufacturing and integration of electronics and EMP protection products and solutions. The company rely exclusively on each of its two manufacturing facilities to earn revenues, pay its operating expenses and service our debt.