Paras Defense makes stellar debut in stock market
Defense sector company Paras Defense and Space Technologies Ltd.’s listing in the stock market today has brightened the faces of investors. The share of Paras Defense is listed on BSE at a premium of 171 per cent over the issue price. Paras Defense had fixed the share price for the IPO at Rs 175. While it is listed on BSE at Rs 475. That is, there is a profit of Rs 300 on each share on the opening day itself. The question is now what investors should do after listing. Sell and take the listing gain or hold it for future also?
Talking about Paras Defense, the size of the company is very less. The company’s market cap will be between Rs 600 crore and Rs 650 crore. The company’s revenue is around 150 crores, which is much less than peer companies. There is an order book of only Rs 300 crore. However, the money that will come from the IPO will bring growth.
IPO got great response from investors
The IPO of Paras Defense got a great response from the investors. It was subscribed about 318 times overall making it the most subscribed IPO not just in 2021 but overall as well. For retail investors, 35 per cent of it was reserved and it was oversubscribed almost 113 times. 50 per cent of the issue was reserved for qualified institutional investors, which oversubscribe close to 170 times. At the same time, 15 per cent was reserved for non-institutional investors, which was oversubscribed almost 928 times. The Offer was comprising of fresh issuance of Equity Shares aggregating up to Rs 140.6cr (“Fresh Issue”) and an offer for sale of up to 17,24,490 Equity Shares by Selling Shareholders.
What does Paras Defense do?
Paras Defense and Space Technologies is engaged in the business of Defense and Space Optics, Defense Electronics, Electromagnetic Pulse Protection Solutions and Heavy Engineering. The company will use the funds received from the IPO for the purchase of machinery and equipment, besides meeting the working capital requirements. Apart from this, a part of the fund will be used by the company for debt repayment and general corporate purposes. It has plants in Navi Mumbai and Thane. The company also provides its services to countries like Belgium and South Korea.
