OBSC Perfection Limited is making headlines in the Indian market with its IPO (Initial Public Offering) set to raise ₹66.02 Crores. The subscription period for this book-built issue commenced on October 22, 2024, and will conclude on October 24, 2024. Investors are keenly awaiting the allotment, which is expected to be finalized on October 25, 2024, with the shares tentatively listed on the NSE SME by October 29, 2024.

The share price band for the OBSC Perfection IPO is fixed between ₹95 to ₹100 per equity share, and investors must apply in minimum lots of 1,200 shares, translating to a minimum investment of ₹1,20,000 for retail investors. High-Net-Worth Individuals (HNIs) must invest at least ₹2,40,000 by applying for two lots.

The company has appointed UNISTONE CAPITAL PRIVATE LIMITED as the book-running lead manager, while BIGSHARE SERVICES PRIVATE LIMITED serves as the registrar for this issue. Additionally, R. K. Stock Holding Private Limited will act as the market maker for the OBSC Perfection IPO.

Financial Overview:

As of October 24, 2024, the Grey Market Premium (GMP) for OBSC Perfection is reported to be ₹0. This premium is largely speculative and depends on the unregulated demand and supply dynamics in the grey market, which is not an accurate measure for determining the IPO's potential performance.

As per the live subscription status, the IPO was subscribed 3.00 times on its final day, reflecting strong interest from investors. Furthermore, OBSC Perfection has raised ₹18.79 Crores from anchor investors at a price of ₹110 per share, showcasing confidence in the company's valuation.

Objectives of the IPO:

The proceeds from the fresh issue will be utilized for several key objectives, including:

1. Funding capital expenditure for machinery purchases at its Unit III in Tamil Nadu, amounting to ₹1,542.00 Lakhs.
2. Capital expenditures for machinery at its Unit IV in Maharashtra, which will require ₹1,517.00 Lakhs.
3. Working capital needs of the company amounting to ₹1,666.00 Lakhs.
4. General corporate purposes to bolster overall operational efficiency.

Company Background:

OBSC Perfection specializes in precision metal components, providing high-quality engineering products across various industries, particularly catering to leading OEMs that supply parts to top automotive manufacturers in India. The leadership team, comprising experienced industry professionals, drives the company towards sustainable growth.

Financial performance metrics reveal that revenues for the five months ended August 31, 2024, were ₹5,700.15 Lakhs, with a robust EBITDA of ₹1,031.99 Lakhs for the same period. The Profit after Tax for this period stood at ₹603.05 Lakhs. The pre-issue EPS is recorded at ₹6.84, with a post-issue EPS of ₹4.99. The pre-issue P/E ratio is 14.61x, which indicates the IPO's fair pricing compared to the industry P/E of 40.45x.

However, potential investors are advised to consider the Grey Market Premium, which currently indicates a lack of anticipated listing gains. Based on these evaluations, it is recommended to avoid the OBSC Perfection IPO for quick listing gains or as a long-term investment.

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This article covers essential details regarding the OBSC Perfection IPO, ensuring you stay informed and make educated investment decisions.