Lakshya Powertech, a company that has carved a distinctive niche in offering tailored EPC services for the oil and gas, power generation, and renewable energy sectors, both domestically and globally, is set to launch its Initial Public Offering (IPO). The IPO amounting to ₹49.91 crore, is a Book Built Issue, consisting of a fresh issue of 27.72 lakh shares. The subscription period for the Lakshya Powertech IPO opens on October 16, 2024, and closes on October 18, 2024. The allotment date is scheduled for October 21, 2024, with the shares expected to be listed on the NSE SME on or around October 23, 2024.

IPO Price Band and Lot Size
The IPO price band for Lakshya Powertech is set between ₹171 and ₹180 per share. For retail investors, the minimum investment is 800 shares or ₹1,44,000, while High-Net-Worth Individuals (HNIs) need to invest in a minimum of 2 lots, or 1,600 shares, amounting to ₹2,88,000.

Lead Manager and Market Maker
GYR Capital Advisors Private Limited is the book-running lead manager for this IPO, with KFin Technologies Limited as the registrar. Giriraj Stock Broking Private Limited will act as the Market Maker, ensuring liquidity for the stock after listing.

Lakshya Powertech IPO GMP – Potential Listing Gains

The Grey Market Premium (GMP) of Lakshya Powertech is expected to be in the range of ₹76 to ₹80, suggesting a potential listing gain of 40% to 44%. It is essential to note that while the GMP indicates investor sentiment in the unorganized market, it is not a reliable predictor of the actual listing price. The real discovery of price will happen once the shares are officially listed on the exchange.

Investors should always exercise caution when relying on Grey Market Premium for making investment decisions, as it fluctuates based on demand and supply in the unorganized market. For educational purposes, it is observed that Lakshya Powertech may provide notable listing gains, given its strong financial performance and solid reputation in the EPC services industry.

Anchor Investors Participation

In a significant development, Lakshya Powertech has raised ₹13.39 crore from Anchor Investors at the upper band price of ₹180 per share. A total of 7,44,000 equity shares were allocated to the anchor investors, further demonstrating institutional confidence in the company's future prospects.

Objectives of the IPO
The Lakshya Powertech IPO will use the proceeds from the fresh issue for the following purposes:

▪ ₹450 lakh will be utilized for the prepayment or repayment of certain outstanding borrowings.

▪ ₹3,000 lakh will be used to fund the working capital requirements of the company.

The remainder will be allocated towards general corporate purposes.

Financial Performance of Lakshya Powertech

Lakshya Powertech has demonstrated strong financial growth, with revenues from operations reaching ₹5,815.38 lakh for the period ended August 31, 2024, compared to ₹14,941.92 lakh in FY 2024, ₹5,311.21 lakh in FY 2023, and ₹3,421.39 lakh in FY 2022. The EBITDA for the period ended August 2024 stood at ₹947.27 lakh, reflecting a growth trajectory from ₹2,318.64 lakh in FY 2024 and ₹477.66 lakh in FY 2023. Profit after tax (PAT) for the period was ₹597.11 lakh, continuing an upward trend from ₹1,567.77 lakh in FY 2024 and ₹271.09 lakh in FY 2023.

With a pre-issue EPS of ₹21.75 and post-issue EPS of ₹15.54, Lakshya Powertech is offering its shares at a pre-issue P/E ratio of 8.27x and post-issue P/E ratio of 11.58x, which is considered fairly priced when compared to the industry average of 38.71x. The company boasts an ROCE of 36.56% and RoAE of 81.77% for FY24, further solidifying its appeal to investors.

Allotment Date and How to Check Allotment Status

The Lakshya Powertech IPO allotment will be finalized on October 21, 2024. To check the allotment status, investors can follow these steps:

▪ Visit the IPO allotment status page on the registrar's website.

▪ Select Lakshya Powertech Limited IPO from the dropdown list.

▪ Enter your application number, PAN, or DP Client ID.

▪ Submit the details to view your allotment status.

Conclusion – Should You Apply for the Lakshya Powertech IPO?

Considering Lakshya Powertech’s strong financials, fair valuation, and potential for listing gains, the IPO presents a promising opportunity for both retail and institutional investors. The company's expansion into global markets and niche focus on EPC services for high-demand sectors like oil & gas and renewable energy further add to its appeal.

Investors looking for short-term listing gains or long-term growth should consider applying for this IPO.

Disclaimer: The information provided is for educational purposes only. Always consult a financial advisor before making any investment decisions.

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