Welcome to this comprehensive analysis of the Aditya Infote IPO. This article delves into the crucial aspects surrounding its upcoming listing, including strategic approaches for allottees and non-allottees, the potential for post-listing momentum, and a detailed look at its Grey Market Premium (GMP). We will explore the underlying reasons influencing its market performance.
IPO Overview and Investor Allocation
The Aditya Infote IPO successfully raised ₹1300 crore from the market. A significant portion of the issue, approximately 1,43,77,888 equity shares (about 74.62%), was allocated to Qualified Institutional Buyers (QIBs). Within the QIB allocation, 30% of shares went to QIBs, and 45% were allocated to Anchor Investors.
High Net Worth Individuals (HNIs) received around 15% of the total shares, amounting to approximately 2,87,556 equity shares, which includes both Small and Big HNIs. Specifically, 10% was allocated to Big HNIs and 5% to Small HNIs. Retail investors were allocated 1,91,737 equity shares, representing about 9.95% of the total. Consequently, only about 87,138 retail investors secured an allotment.
Impact of Retailer Allocation and Volatility
Out of the total issue size of ₹1300 crore, approximately ₹130 crore (10%) worth of shares were allocated to retailers. Due to the low number of retail allottees, there is unlikely to be significant selling during dips or heavy buying during rallies. This implies that the company may not experience high volatility. The reduced retail allocation is seen as a positive for both short-term and long-term investors, as it minimizes the risk of panic selling during corrections or heavy selling during sharp uptrends. This scenario is expected to support short-term momentum and increase the likelihood of long-term growth for the company.
Promoter Confidence and Issue Structure
Promoter holding stood at 92.58% initially and is currently at 76.7%, indicating strong promoter confidence in the company’s future growth. The IPO comprised a combination of fresh issue and offer for sale (OFS). The fresh issue portion, valued at ₹500 crore, will be used for the company’s growth initiatives, while the OFS component accounted for ₹800 crore. In terms of percentages, the fresh issue represents approximately 40%, and the OFS accounts for about 60%, which is considered a positive point for long-term prospects.
Financial Health and Growth Trajectory
Aditya Infote has demonstrated significant improvement in its financial health. Aligned with the Indian government’s ‘Make in India’ initiative and the increasing demand for electronic goods in the Indian market, the company has seen substantial profit growth. Its profit surged from ₹108 crore in FY2023 to ₹115 crore in FY2024, and further to ₹351 crore in FY2025. This robust financial performance is reflected in its attractive valuation metrics.
Key Valuation Metrics
The company boasts a Return on Equity (ROE) of 34.53% and a Return on Capital Employed (ROCE) of 33.27%. Its Debt-to-Equity ratio is healthy at 0.41, with a Return on Net Worth matching ROE at 34.53%. The Profit After Tax (PAT) margin stands at 11.25%, and the EBITDA margin is 8.27%, indicating healthy profitability in its operating segment. Post-IPO, the company’s Price-to-Earnings (P/E) ratio at the cut-off price is 23, with an Earnings Per Share (EPS) above 30, suggesting an attractive valuation that directly impacted the GMP and led to high subscription numbers. The company plans to utilize ₹375 crore from the raised funds for debt repayment.
Important Dates and Lock-in Periods
Important dates for investors include August 31st, as 50% of 8,62,766 equity shares worth ₹582 crore, allocated on July 28th, will become eligible for sale after a 30-day lock-in period. October 13th is another crucial date, when the remaining 50% of locked-in shares will be available for sale.
Listing Day Strategy and Price Action
Aditya Infote is slated for listing on both BSE and NSE. Price action is expected between 9:00 AM and 9:45 AM, specifically 9:30 AM to 9:45 AM, where the listing price will be fixed. Updates on this will be shared via the Telegram group. Regular buying and selling will commence from 10:00 AM. For short-term investors, if the low formed between 10:00 AM and 10:30 AM holds as a support level and doesn’t break further, there could be opportunities to add more and capitalize on short-term momentum. The company appears promising for long-term holding as well, with good listing gains expected.
Grey Market Premium (GMP) Insights
The Grey Market Premium (GMP) for Aditya Infote IPO is currently trading at ₹95. With the IPO price at ₹675, a gain of ₹295 is anticipated, leading to an estimated listing price of ₹970. This suggests a potential listing gain of approximately 44%, translating to about ₹6500 per lot. This GMP reflects the current market sentiment and is based on ongoing market activity as per SSC reports. A sustained recovery in the broader market and no significant decline in US markets could further support a positive listing.
Personal Investment Strategy
The speaker, who did not receive an allotment, stated that if they had, they would have held the shares for 6 months to 1 year, not just for listing gains. However, for those who applied solely for listing gains, exiting on listing day is an option. The speaker personally intends to buy some quantity on listing day and potentially add more if the price holds a support level between 10:00 AM and 10:30 AM.
Conclusion
Aditya Infote IPO presents a promising outlook due to its strong financials, attractive valuations, positive growth in the electronics sector, and healthy subscription figures from QIBs (40x oversubscribed). The company’s focus on the ‘Make in India’ initiative and increasing demand for Indian electronic companies are strong tailwinds. This positive momentum is expected to continue, offering potential for both short-term gains and long-term value creation. Any further market developments will be updated promptly.
