Mamata Machinery IPO: Will listing warrant overwhelming response?

Shares of Mamata Machinery are listed on the stock exchange after a blockbuster success in the primary market through 194.95 times subscription. The company, which attracted all categories of investors, has set the issue price at ₹243, which is the upper end of the price range of ₹230-243.

Based on market activity, the share price is likely to double at the time of listing. “Given the market sentiment and massive subscription demand, we expect the company to go public with strong stock market appreciation and a high probability of achieving a return of close to 100 per cent on its issue price,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.

“We advise conservative investors that they can book profits that exceed our expectations. “Long-term investors should consider holding it for the long term despite knowing the short-term volatility and risk in the markets,” he advised, adding for unallocated investors, we advise accumulation if we are looking for profit booking after listing experience declines.

The Gujarat-based company entered the capital market with a public offer worth ₹179.38 crore. The IPO was solely an offer for sale of 73.82 lakh shares by promoters Mahendra Patel, Nayana Patel, Bhagvati Patel, Mamata Group Corporate Services LLP and Mamata Management Services LLP.

The QIB share was subscribed 235.88 times while the most aggressive bidders were non-institutions at 274.38 times. The share of private investors received 138.08 times bids, that of employees BY 153.27 times.

The packaging machinery maker has raised over ₹53 crore from anchor investors in the IPO. Mamata Machinery has allotted 22.04 lakh shares to seven funds – 3P India Equity Fund, Authum Investment and Infrastructure, Winro Commercial (India) Ltd, Subhkam Ventures, Chartered Finance and Leasing, Belgrave Investment Fund and Aarth AIF – at ₹243 each Piece.

Since the entire issue is an OFS, the company does not receive any proceeds and the entire amount went to the selling shareholders.

The aim of the first share sale is to take advantage of the benefits of listing its shares on the stock exchange. In addition, the Company believes that the listing of the Shares will enhance its visibility and brand image, provide liquidity to its shareholders and create a public market for the Shares.

Mamata Machinery provides end-to-end manufacturing solutions for the packaging industry. The company sells its machines under the brand names “Vega” and “Win”. The company offers a comprehensive product range that serves the entire value chain of the flexible packaging market.

Beeline Capital Advisors is the sole underwriter of the issue. The shares are expected to be listed on the BSE and NSE on December 27