ASK Automotive IPO: The initial public offering (IPO) of auto ancillary player ASK Automotive, which opened for public subscription on Tuesday, has received 47 per cent subscription till 10.09 am on the second day of the share sale on Wednesday. The Rs 833.91-crore has so far received bids for 96,77,111 shares against 2,06,99,974 shares on offer.
The portion for retail individual investors (RIIs) was subscribed 68 per cent, while the quota for non-institutional investors received 55 per cent subscription. The category for qualified institutional buyers (QIBs) got 3 per cent subscription.
ASK Automotive IPO GMP Today
According to market observers, unlisted shares of ASK Automotive remain Rs 55 higher in the grey market as compared to its issue price. The Rs 55 grey market premium or GMP is about 19.5 per cent higher than its upper issue price of Rs 282 per share. This means the grey market is expecting a 19.5 per cent listing gain from the public issue.
‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
About ASK Automotive IPO
The IPO is an offer for sale (OFS) of 2,95,71,390 equity shares by promoters — Kuldip Singh Rathee and Vijay Rathee. Since the IPO is completely an OFS, the entire proceeds will go to shareholders divesting their shares.
The issue has a price band of Rs 268-282 per equity share. At the upper end of the price band, the IPO is expected to fetch Rs 833.91 crore. Investors can bid for a minimum of 53 shares and in multiples thereof.
ASK Automotive has mobilised a little over Rs 250 crore from anchor investors, ahead of the IPO.
JM Financial Ltd, Axis Capital Ltd, ICICI Securities Ltd and IIFL Securities Ltd are the book-running lead managers to the issue. The equity shares are proposed to be listed on the BSE and the NSE.
ASK Automotive IPO: Should You Buy?
Giving ‘Subscribe’ recommendation, brokerage Swastika Investmart said, “The IPO is coming at a PE (price-earnings) valuation of 45.63 times, which is reasonably priced. Looking at these factors and the long-term growth prospects, we will give a Subscribe rating to this IPO for long term.”
Another brokerage BP Equities has also given ‘subscribe’ recommendation for the IPO. “On the valuation front, the issue is valued at a P/E of 39.8 times on the upper price band based on Q1FY24 annualised earnings. We recommend a ‘Subscribe’ for the benefit of listing gains for the issue, as most of the positives seem priced in the offering,” it said.
The company has achieved further weight reduction, enhanced performance and improved vehicle acceleration via high-performance driveline products and improved efficiencies, positioning it firmly in the market.
About ASK Automotive
Gurugram-based ASK Automotive is one of the largest manufacturers of brake-shoe and advanced braking systems for two-wheelers in India with a market share of about 50 per cent in the 2022 fiscal.
The firm supplies safety systems and critical engineering solutions with in-house designing, developing, and manufacturing capabilities. The company has clients, including TVS Motor Company Ltd, Hero MotoCorp, Greaves Electric Mobility and Bajaj Auto.
ASK shares strong relations with all the top two-wheeler manufacturers in the country. It has a robust production model and a technology and innovation-based manufacturing process.
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