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17 January 2024

AMIC Forging IPO: Forging Ahead in the Growth Spectrum

Introduction:

AMIC Forging Limited, a prominent player in the forging sector, recently concluded its Initial Public Offering (IPO), marking a significant milestone in its journey. With a total issue size of Rs 34.80 crores and an exclusive fresh issue of 27.62 lakh shares, the IPO garnered substantial interest from investors. Let's delve into the key details and performance indicators that define AMIC Forging's recent market debut.

Key Dates:

Bidding Period	November 29 to December 1, 2023
Allotment Date	December 4, 2023
Listing Date	December 6, 2023

IPO Highlights:

Price Band	₹121 to ₹126 per share
Lot Size	1000 shares
Minimum Investment	₹126,000 for retail investors

Financial Overview:

Total Issue Size	Fresh Issue
2,762,000 shares, aggregating up to ₹34.80 Cr	2,762,000 shares

Shareholding Structure:

Pre-Issue Shares	Post-Issue Shares
7,726,410	10,488,410

Market Maker Segment:

Gretex Share Broking	139,000 shares

IPO Managers and Registrar:

Lead Managers	Registrar	Market Maker
Gretex Corporate Services Limited	Bigshare Services Pvt Ltd	Gretex Share Broking

Subscription Insights:

The AMIC Forging IPO witnessed an overwhelming response, with an overall subscription of 289.05 times. Non-Institutional Investors (NII) demonstrated notable enthusiasm with a subscription of 589.27 times, while Retail investors subscribed 273.01 times and Qualified Institutional Buyers (QIBs) at 91.43 times.

IPO Journey Timeline:

IPO Open Date	IPO Close Date	Basis of Allotment	Listing Date
November 29, 2023	December 1, 2023	December 4, 2023	December 6, 2023

Lot Size:

Investors could bid for a minimum of 1000 shares, with the following investment parameters for retail investors and High Net Worth Individuals (HNIs):

Application	Lots	Shares	Amount
Retail (Min)	1	1000	₹126,000
Retail (Max)	1	1000	₹126,000
HNI (Min)	2	2,000	₹252,000

AMIC Forging IPO Reservation:

The IPO featured a reservation of 2,762,000 shares, allocating portions to Anchor Investors, Market Maker, QIBs, NIIs, and retail investors.

About AMIC Forging Limited:

Established in 2007, AMIC Forging Limited, formerly known as Kali Mata Forging Private Limited, stands as a key player in the forging industry. The company's diverse product portfolio includes main shafts for wind energy, drum tube sheets, casting molds, forged shells, tube sheets, and various components catering to industries such as heavy engineering, steel, oil and gas, petrochemicals, refineries, power plants, and more.

Financial Performance:

AMIC Forging showcased robust financials, reporting impressive figures for the period ending June 30, 2023. The company witnessed a significant surge in revenue and profit after tax (PAT).

Metric	Values
Assets	₹6,367.84 Lakhs
Revenue	₹2,979.32 Lakhs
Profit After Tax	₹359.94 Lakhs
Net Worth	₹2,338.43 Lakhs
Reserves and Surplus	₹2,252.58 Lakhs
Total Borrowing	₹287.37 Lakhs

Key Performance Indicators:

- Market Capitalization: ₹132.15 Crores
- Return on Equity (ROE): 71.25%
- Return on Capital Employed (ROCE): 55.78%
- Debt/Equity: 0.26
- Return on Net Worth (RoNW): 49.40%

Objects of the Issue:

The net proceeds from the IPO will be allocated for setting up a manufacturing facility, meeting working capital requirements, and general corporate purposes.

Conclusion:

While the AMIC Forging IPO received remarkable subscription numbers, industry experts advise caution due to the competitive nature of the forging segment and concerns about the sustainability of boosted profit margins. Informed investors with a medium to long-term outlook may discover potential in the company's growth trajectory. As AMIC Forging steps into the public market, it brings forth new opportunities and advancements in the forging industry, positioning itself as a key player in the growth spectrum.

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