TruAlt Bioenergy IPO: A Comprehensive Overview for Indian Investors
TruAlt Bioenergy Ltd.’s initial public offering (IPO) has garnered significant attention from investors, with the company aiming to raise nearly Rs 839.28 crore from the primary market. In this article, we will delve into the details of the IPO, including its subscription status, grey market premium (GMP), and other key aspects that Indian investors should be aware of.
Subscription Status: A Mixed Bag
As of the second day of bidding, the TruAlt Bioenergy IPO was subscribed 0.81 times. This indicates a moderate response from investors, with the issue receiving bids for 0.81 times the number of shares on offer. The subscription status can be broken down into the following categories:
- Institutional investors (QIB): 0.87 times or 87%
- Non-Institutional investors (NII): 0.80 times or 80%
- Retail investors: 0.79 times or 79%
While the subscription status may seem modest, it is essential to note that the IPO market has been volatile in recent times, and investors are becoming increasingly selective about the issues they participate in.
Grey Market Premium (GMP): A Positive Indicator
The grey market premium (GMP) of the TruAlt Bioenergy IPO is currently at Rs 92, according to Investorgain.com. This indicates a positive sentiment among investors, with the stock expected to list at a premium to its issue price. The estimated listing price is Rs 588, which implies a gain of 18.55% over the IPO price of Rs 496.
However, it is crucial to note that GMP does not represent official data and is based on speculation. Investors should exercise caution and not rely solely on GMP when making investment decisions.
IPO Details: Key Aspects to Consider
The TruAlt Bioenergy IPO is a book-built issue that comprises a fresh issue of 1.51 crore shares aggregating Rs 750 crore and an offer-for-sale of 0.18 crore shares totalling Rs 89.28 crore. The price band for the issue is set between Rs 472 and Rs 496 per share, with each lot size consisting of 30 shares.
The IPO is scheduled to open on September 25 and will close on September 29. The minimum investment required for retail investors is Rs 14,880 at the upper price band, while Small Non-Institutional Investors (sNII) require a minimum investment of 14 lots or 420 shares, totalling Rs 2,08,320. Big Non-Institutional Investors (bNII) need to invest a minimum of 68 lots or 2,040 shares, amounting to Rs 10,11,840.
Company Profile: TruAlt Bioenergy’s Business and Financials
TruAlt Bioenergy is primarily engaged in the production of biofuels, with a strong focus on the ethanol segment. The company was founded in 2021 and has reported significant growth in its financials. For the financial year ended March 31, TruAlt Bioenergy reported a total income of Rs 1,968.53 crore, up from Rs 1,280.19 crore in the previous year. Profit after tax also saw strong growth, increasing to Rs 146.64 crore from Rs 31.81 crore. Ebitda for the same period stood at Rs 309.14 crore, compared to Rs 188.09 crore in FY24.
The company plans to use the proceeds from the IPO to fund its capital expenditure, working capital, and general corporate purposes. Around Rs 150 crore will be allocated for capital expenditure, while nearly Rs 425 crore will be used for working capital. The remaining funds will be utilized for general corporate purposes.
Conclusion: Should You Invest in the TruAlt Bioenergy IPO?
The TruAlt Bioenergy IPO presents an opportunity for investors to participate in the growth story of a company that is focused on the production of biofuels. While the subscription status may seem modest, the grey market premium indicates a positive sentiment among investors.
However, as with any investment decision, it is essential to exercise caution and conduct thorough research before investing in the IPO. Investors should carefully evaluate the company’s financials, business model, and growth prospects before making a decision.
In conclusion, the TruAlt Bioenergy IPO is an interesting opportunity for investors who are looking to diversify their portfolio and participate in the growth of the biofuels sector. However, it is crucial to approach the issue with a cautious and informed mindset, considering all the key aspects and factors that can impact the investment decision.
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