ATC Energies System Limited, a leading manufacturer of customized Li-Ion battery packs, is set to launch its initial public offering (IPO) on the NSE SME platform. With a reputation for quality products and a robust production capacity among Asia’s top 10, ATC Energies System is positioned for growth in the rapidly expanding battery manufacturing sector.

IPO Details

ATC Energies System’s IPO is a book-built issue amounting to ₹63.76 Crores. The offer consists of a fresh issue of 43.23 lakh shares, valued at ₹51.01 Crores, and an offer for sale (OFS) of 10.80 lakh shares, totaling ₹12.74 Crores. The subscription period for the IPO opens on March 25, 2025, and closes on March 27, 2025. The allotment is expected to be finalized on March 28, 2025, with shares expected to be listed on the NSE SME on April 2, 2025.

The IPO’s price band is set between ₹111 and ₹118 per equity share. At the upper end of the price band, the market capitalization of ATC Energies System will be ₹240.58 Crores. The lot size for the IPO is 1,200 shares, with retail investors needing to invest a minimum of ₹1,41,600. For High-Net-Worth Individuals (HNIs), the minimum investment is ₹2,83,200, equivalent to 2 lots.

Lead Managers and Registrar
Indorient Financial Services Limited is the book running lead manager for the ATC Energies System IPO, while KFIN Technologies Limited will act as the registrar. Alacrity Securities Limited will serve as the market maker for the IPO.

GMP and Subscription Status

As of March 27, 2025, the ATC Energies System IPO has been subscribed 1.58 times on its final day of the subscription period. The Grey Market Premium (GMP) is reported to be ₹0, reflecting a lack of real trading in the grey market. This suggests minimal speculative demand before the listing. It is important to note that the Grey Market Premium does not provide an accurate price discovery.

IPO Allotment
The allotment date for the ATC Energies System IPO is set for March 28, 2025. Investors can check the allotment status by visiting the registrar's website. To check the allotment status, you need to select the ATC Energies System Limited IPO from the list and enter your application number, PAN, or DP Client ID.

Objectives of the IPO

The net proceeds from the IPO will be utilized for various strategic purposes:

1. Repayment of Borrowings: ₹952.83 Lakhs will be used to repay or prepay loans for the purchase of the Noida factory, including land and building.

2. Capital Expenditure: ₹672.16 Lakhs will be directed towards refurbishing and upgrading the Noida factory.

3. IT Upgradation: ₹746.88 Lakhs will be allocated for IT infrastructure upgrades at their Noida and Vasai factories, as well as the registered office.

4. Working Capital: ₹950 Lakhs will be used for working capital requirements.

5. General Corporate Purposes.

Financials and Performance

The company has demonstrated steady growth in revenue and profitability:

• Revenues from operations: ₹2,249.41 Lakh (FY 2024), ₹5,120.37 Lakh (FY 2023), ₹3,313.54 Lakh (FY 2022).

• EBITDA: ₹825.42 Lakh (FY 2024), ₹1,547.37 Lakh (FY 2023), ₹1,157.69 Lakh (FY 2022).

• Profit after Tax (PAT): ₹577.15 Lakh (FY 2024), ₹1,089.16 Lakh (FY 2023), ₹775.57 Lakh (FY 2022).

Key Performance Indicators:

• Pre-issue EPS: ₹6.78

• Post-issue EPS: ₹5.34

• Pre-issue P/E ratio: 17.40x

• Post-issue P/E ratio: 22.09x

• ROCE: 42.66% (FY 2024)

• ROE: 39.38% (FY 2024)

The Grey Market Premium (GMP) of ATC Energies System IPO is ₹0, indicating no price movement in the grey market. This signals that the IPO may not experience any significant listing gains.

ATC Energies System IPO Review

Given the company’s consistent financial performance and strategic objectives, the IPO is priced fairly. However, with a GMP of ₹0 and considering the high valuation compared to industry standards, we recommend avoiding this IPO for short-term listing gains. Investors looking for long-term investment should also consider the potential risks associated with the company’s dependence on the battery manufacturing sector, which may face future volatility.

The Current active IPO are Aten Papers & Foam Limited, Infonative Solutions Limited,Spinaroo Commercial Limited,Retaggio Industries Limited.

The Closed IPOs are  Identixweb Limited, ATC Energies System Limited, Shri Ahimsa Naturals Limited.

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