India’s Paras raises fresh pre-IPO funds from investors
By Vinu Lal
08:01, 21 September 2021
Indian defence and space engineering company Paras Defence and Space Technologies raised INR510m ($6.9m) from anchor investors, ahead of its initial share sale, according to a listing update on the Bombay Stock Exchange.
Paras Defence is offering new shares worth INR1.4bn and an offer for sale of 170,000 shares through its initial public offer (IPO). The issue, with a price band of INR165-175 per share, opened for public subscription today and would extend till 23 September.
Those selling shares through an offer for sale are company owners Sharad Virji Shah, Munjal Sharad Shah and individual selling shareholders such as Munjal Shah, Shilpa Amit Mahajan and Amit Navin Mahajan.
At the upper end of the price band, the IPO is expected to fetch INR1.7bn.
Anchor investors
Ashoka India Equity Investment Trust, Abakkus Emerging Opportunities Fund-1, Saint Capital Fund, Nippon India Mutual Fund and HDFC Mutual Fund participated in the anchor book, the exchange note said.
Proceeds of the fresh issue would be used to fund capital expenditure requirements, to support incremental working capital requirements and repayment or prepayment of debt.
Half of the issue size has been reserved for qualified institutional buyers, 35% for retail investors and the remaining 15% for non-institutional investors.
Paras model
Paras is engaged in designing, developing, manufacturing and testing a wide range of defence and space engineering products and solutions.
An analyst report by ICICI Direct Research said Paras has little competition in the Indian market as an integrated defence and space player operating in all four segments – defence electronics, electromagnetic pulse solutions, defence optics and heavy engineering. Most other companies in India operate only in one or two segments, the report added.
It also added that capital investments into these four segments in India are likely to reach $14.5bn by 2031 due to re-capitalisation and greater indigenous supply preferences.
Read More: India’s Sansera Engineering raises m from anchor investors
Related topics