Weak Debut! Ajax Engineering shares list at ₹576 on NSE, a discount of 8.43% from IPO price

Ajax Engineering IPO listing: Ajax Engineering shares make a weak debut on Monday, February 17, listing at ₹576 on NSE, a discount of 8.43 percent versus its IPO price of ₹629. Meanwhile, on BSE, it listed at ₹593, down 5.7 percent from IPO price.

Ajax Engineering s initial public offering (IPO), valued at ₹1,269.35 crore, was open for subscription from February 10 to February 12. The IPO price was fixed at ₹629 per equity share.

Following the three days of bidding, Ajax Engineering IPO closed with strong demand, garnering 6.06 times bids. The IPO received bids for 8.57 crore shares against 1.41 crore shares on offer. The retail investor segment was booked 1.94 times, while the non-institutional investors (NII) category was subscribed 6.46 times. Moreover, the Qualified Institutional Buyers quota was bid 13.04 times in the 3 days of bidding.

About the IPO

Ajax Engineering IPO was entirely an offer for sale of 2.02 crore shares with no fresh equity component. Retail investors could apply with a minimum lot size of 23 shares, requiring a minimum investment of ₹13,777.

The issue includes a reservation of up to 78947 shares for employees offered at a discount of ₹59.00 to the issue price.

The IPO raised ₹379.32 crore from anchor investors on February 7, 2025.

The Company will not receive any proceeds of the Offer. Each of the Selling Shareholders will be entitled to the respective proportion of proceeds of the Offer for Sale after deducting its portion of the Offer-related expenses and the relevant taxes thereon.

ICICI Securities Limited, Citigroup Global Markets India Private Limited, JM Financial Limited, Nuvama Wealth Management Limited, SBI Capital Markets Limited are the book running lead managers of the Ajax Engineering IPO, while Link Intime India Private Ltd is the registrar for the issue.

About the Company

Incorporated in July 1992, Ajax Engineering Limited specializes in manufacturing a diverse range of concrete equipment and services across the value chain. As of September 30, 2024, the company has developed 141 concrete equipment variants and sold over 29,800 units in India over the past decade. Its design, engineering, and development team comprises 79 full-time employees, representing approximately 15.96 percent of its total workforce.

The company operates four manufacturing facilities in Karnataka, located in Obadenahalli, Gowribidanur, and Bashettihalli, with each specializing in different product categories, particularly the Obadenahalli facility.

Review

Brokerages have given a Subscribe rating to the Ajax Engineering IPO, citing strong financial performance, market leadership, and growth potential.

KR Choksey: Subscribe

Brokerage firm KR Choksey has assigned a Subscribe rating to the Ajax Engineering IPO, citing its reasonable valuation compared to industry peers and strong financial performance. The company has delivered a Revenue/PAT CAGR of 51 percent/84 percent from FY22 to FY24, highlighting its impressive growth trajectory.

“With its dominant market share, sustained growth, and a favorable industry outlook, Ajax Engineering presents a compelling investment opportunity. Hence, we assign a ‘Subscribe’ rating,” KR Choksey stated in its research report.

Reliance Securities: Subscribe

Reliance Securities has also recommended subscribing to the IPO, emphasizing Ajax Engineering’s first-mover advantage in introducing Self-Loading Concrete Mixers (SLCMs) in India. Analysts noted that the company’s high-quality products, strong after-sales service, and market expansion efforts have strengthened its leadership position.

“AEL has enhanced its capabilities, expanded its market share in non-SLCM products, and is increasing its presence in overseas markets through exports while also exploring inorganic growth opportunities. With a focus on capital efficiency, strong return ratios, and an experienced management team, the company is well-positioned for future growth,” Reliance Securities stated.