Indo Farm Equipment Ltd is set to launch its initial public offering (IPO) with a price band of ₹204 to ₹215 per share, opening on December 31, 2024. The IPO will consist of a fresh issue of up to 86 lakh shares and an offer for sale of up to 35 lakh shares, aiming to raise approximately ₹260 crore. The proceeds from the fresh issue will primarily be used to establish a dedicated manufacturing unit for expanding the production capacity of Pick & Carry Cranes.
₹80
₹215
₹256
Expert Opinions
Market sentiment for the Indo Farm Equipment IPO is generally positive, reflecting strong investor interest in the agricultural machinery sector. Company strengths include a robust manufacturing facility in Himachal Pradesh, with an annual production capacity of 12,000 tractors and 720 pick-and-carry cranes, demonstrating significant operational capabilities. However, risks and challenges involve reliance on the agricultural sector’s cyclical nature and potential fluctuations in raw material costs that could impact profitability.
The valuation analysis indicates a fresh issue of 86 lakh equity shares, with proceeds aimed at expanding manufacturing capabilities and reducing debt, which could enhance financial stability. From a long-term investment perspective, Indo Farm Equipment is well-positioned to benefit from increasing demand for agricultural machinery driven by government initiatives and infrastructure development, making it an attractive option for investors seeking exposure to this essential sector while being mindful of inherent market risks.
Investor Considerations
Company performance and fundamentals indicate a steady operational history, with revenue of ₹375.32 crores in FY24, reflecting a 1.35% increase from the previous year, and a profit after tax of ₹15.95 crores, which is a 3.7% rise. The sector outlook for agricultural and construction equipment remains positive, driven by government initiatives supporting mechanization and infrastructure development.
The IPO valuation is set between ₹204 and ₹215 per share, aiming to raise approximately ₹260.15 crores to enhance production capacity and reduce debt. Growth prospects are bolstered by plans to establish a new manufacturing unit, increasing crane production capabilities and expanding market reach. However, risk factors include reliance on agricultural cycles, high competition from established players, and thin profit margins of around 4.16%. A long-term investment horizon is recommended, as Indo Farm Equipment is well-positioned to capitalize on industry growth while navigating inherent risks effectively.
| Date | GMP | Trend |
|---|---|---|
| 06 Jan 2025 16.45 | ₹80 | Down |
| 05 Jan 2025 10.06 | ₹100 | Up |
| 04 Jan 2025 11.44 | ₹90 | --- |
| 03 Jan 2025 10.54 | ₹90 | --- |
| 02 Jan 2025 10.40 | ₹90 | Down |
| 01 Jan 2025 10.58 | ₹100 | --- |
| 31 Dec 2024 16.32 | ₹100 | Up |
| 30 Dec 2024 10.55 | ₹80 | --- |
| 29 Dec 2024 12.04 | ₹80 | --- |
| 28 Dec 2024 11.33 | ₹80 | --- |
| 27 Dec 2024 11.12 | ₹80 | --- |
| 26 Dec 2024 11.32 | ₹80 | Up |
| 25 Dec 2024 11.28 | ₹50 | Up |
| 24 Dec 2024 11.13 | ₹00 | --- |
| 23 Dec 2024 12.10 | ₹00 | --- |
| 21 Dec 2024 12.23 | ₹00 | --- |
| 20 Dec 2024 10.45 | ₹00 | --- |
| 19 Dec 2024 17.50 | ₹00 | --- |
| 18 Dec 2024 12.25 | ₹00 | --- |
| 17 Dec 2024 16.03 | ₹00 | --- |
| 12 Dec 2024 16.47 | ₹00 | --- |
FAQs
The Grey Market Premium showed moderate accuracy in predicting Indo Farm Equipment’s listing performance. While the GMP of ₹80 predicted a premium of 37.21% over the issue price, the stock delivered a lower gain of 19.07%. With a prediction error of 13.22%, the GMP correctly predicted the positive listing direction but significantly overestimated the magnitude of gains, demonstrating partial reliability as a directional indicator in this case.
Indo Farm Equipment IPO Current GMP is ₹80.
Indo Farm Equipment IPO Expected Returns is 37.21%.
Indo Farm Equipment IPO estimated listing price is ₹295.