Osel Devices Limited, a leader in technology solutions, made a successful debut on the NSE SME platform with its shares listing at ₹198.05, reflecting a 23.7% premium over the issue price of ₹160. This listing followed a strong demand from investors during the subscription period between September 16 and 19, 2024.

IPO Details and Listing Performance:

Osel Devices' IPO was a book-built issue amounting to ₹70.65 crore, consisting of an entirely fresh issue of 44.16 lakh shares. The price band was set at ₹155-₹160 per equity share, with retail investors required to invest a minimum of ₹128,000 for one lot of 800 shares, while High-Net-Worth Individuals (HNIs) needed to invest at least ₹256,000 for two lots. Horizon Management Private Limited acted as the book-running lead manager, with MAS Services Limited as the registrar and Giriraj Stock Broking Private Limited as the market maker.

Osel Devices' listing at ₹198.05 represents a decent gain for investors, delivering a 23.7% premium on the opening day. The IPO saw a 63.27x oversubscription by its final day, reflecting strong demand from institutional, retail, and HNI investors.

Grey Market Premium (GMP):

The Grey Market Premium (GMP) for Osel Devices was pegged between ₹90 and ₹95 during the IPO phase. Although no real trading is conducted on GMP, it serves as an indicator of expected listing gains. The actual performance on the listing date aligned with the GMP, offering substantial profits to early investors.

Financial Overview:

Osel Devices has demonstrated a strong financial performance over recent years. In FY24, the company reported revenue of ₹13,268.52 lakh, up from ₹8,195.58 lakh in FY23 and ₹6,555.49 lakh in FY22. Its EBITDA for FY24 stood at ₹2,288.29 lakh, significantly higher than ₹868.37 lakh in FY23. The profit after tax (PAT) for FY24 reached ₹1,305.21 lakh, showcasing growth compared to ₹466 lakh in FY23.

With a pre-issue EPS of ₹11.31 and a post-issue EPS of ₹8.09, the P/E ratios for Osel Devices were 14.14x pre-issue and 19.77x post-issue, suggesting that the IPO was reasonably priced given its industry P/E ratio of 38x. Additionally, the company reported a ROCE of 43.17% and ROE of 34.68% for FY24, reinforcing its solid operational performance.

Anchor Investors:

Osel Devices raised ₹20.12 crore from anchor investors, including 12,57,600 equity shares at ₹160 per share. This investment further bolstered market confidence in the company's potential growth.

Objectives of the IPO:

The funds raised from the Osel Devices IPO will be directed toward:

₹600 lakh for loan repayment.

₹4,400 lakh for working capital requirements.

The remaining amount will be allocated for general corporate purposes.

Conclusion:

Osel Devices’ IPO debut delivered strong listing gains, with its shares opening 23.7% higher than the issue price. Investors should note the company's promising financial performance, which supports both short-term gains and long-term growth potential. Given the solid financial metrics, including high ROCE and ROE, this IPO presents a sound investment opportunity for those looking to tap into the expanding technology sector.

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