Popular Foundations opened its SME IPO for subscription on September 13, and the issue is set to close today, September 18. The company aims to raise approximately ₹20 crore through this offering, with plans to list its shares on the BSE SME platform with a price set at ₹37 per share.
Subscription
The IPO saw an overwhelming demand, with the issue subscribed 0.78 times till 2:10 pm on Day 1 of bidding.
The IPO received bids for 39.96 lakh shares against the 51 lakh shares on offer. Specifically, the subscription breakdown was notable across different segments: the retail investor segment saw a subscription of 1.04 times, while the non-institutional investors category was booked 0.53 times.
About the IPO
The Popular Foundations IPO is only a fresh issue of 53.7 lakh shares with no offer for sale component. The company plans to use the net proceeds for several key objectives, including prepaying or repaying a portion of its existing borrowings, funding working capital needs, and general corporate purposes.
Retail investors must apply for a minimum lot size of 3,000 shares, amounting to an investment of ₹1,11,000. High net-worth individuals (HNIs) must apply for at least two lots, or 6,000 shares, totalling ₹2,22,000.
The allotment for the IPO is expected to be finalised on Thursday, September 19, 2024. The shares will be listed on the BSE SME platform on Monday, September 23, 2024.
Srujan Alpha Capital Advisors LLP is the book-running lead manager of the Popular Foundations IPO, while Bigshare Services Pvt Ltd serves as the registrar. Spread X Securities is the market maker for Popular Foundations IPO.
About the company
Established in 1998, Popular Foundations Limited provides specialised engineering and construction services, offering end-to-end solutions across the construction sector. The company focuses on non-residential and non-government projects, primarily in Chennai, while also completing successful projects in cities like Pondicherry, Bangalore, Trichy, and Coimbatore.
Popular Foundations Limited saw a 7 percent revenue growth and a 191 percent rise in profit after tax (PAT) between the fiscal years ending March 31, 2023, and March 31, 2024.
Review
“The company is in the construction business with related service offerings. It posted growth in top and bottom lines for the reported periods, but a higher net for FY24 raises eyebrows. It is operating in a highly competitive and fragmented segment. This can be termed a “High Risk/Low Return” bet and may be skipped,” said Dilip Davda of Chittorgarh.com, suggesting an ‘avoid’ call.
Popular Foundations IPO GMP today
The IPO’s grey market premium (GMP) today is ₹0 per share, which indicates an expected listing price of ₹37, the same as its issue price. The GMP has been the same since September 10.
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