Divgi TorqTransfer Systems IPO: The initial public offering (IPO) of Divgi TorqTransfer Systems Ltd opened for bidding on 1st March 2023 and subscription for the public issue is going to end today. So, investors have just one day in their hand to apply for this ₹412.12 crore IPO. Despite being backed by Infosys co-founder Nandan Nilekani, the IPO has received tepid response from investors. After two days of bidding, the public offer has been subscribed 0.38 times only. As per the Divgi TorqTransfer Systems IPO subscription status after day two of bidding, the retail portion of the public issue has been subscribed 1.56 times whereas NII and QIB portion has been subscribed 0.22 times and 0.06 times respectively.
Meanwhile, grey market sentiments have also gone positive on Divgi TorqTransfer Systems IPO. According to market observers, shares of Divgi TorqTransfer Systems are available at a premium of ₹70 in grey market today.
Divgi TorqTransfer Systems IPO GMP today
As mentioned above, Divgi TorqTransfer Systems IPO grey market premium (GMP) today is ₹70, which is ₹10 higher from its Thursday GMP of ₹60. This rise in grey market sentiments can be attributed to the positive global sentiments that has infused optimism of strong stock market opening today. Experts maintained that Divgi TorqTransfer Systems IPO GMP remained steady at ₹60 despite weakness at secondary markets. So, in case of trend reversal, we can expected more upside in grey market sentiments in regard to this Nandan Nilekani-backed company’s public offer.
What this GMP mean?
Market observers said that Divgi TorqTransfer Systems IPO GMP today is ₹70, which means grey market is expecting that Divgi TorqTransfer Systems IPO listing would be around ₹660 ( ₹590 + ₹70), which is around 12 per cent higher from its price band of ₹560 to ₹590 per equity share.
However, stock market experts maintained that GMP is not an ideal indicator about the success of failure of an IPO. They advised investors to scan balance sheet of the company and find out the sustainability of business and revenue model of the company. They also said that GMP is a non-regulated number which is completely speculative.
Should you apply?
On Divgi TorqTransfer Systems IPO review, Anand Rathi report says, “Divgi TorqTransfer systems limited are one of the very few suppliers in India having the capability to develop and provide system level transfer case, torque coupler, DCT solutions and transmission systems for EVs across a wide array of automotive vehicles and geographies with strategically located manufacturing facilities capable of producing high precision components meeting system level design intent and long-term relationships with marquee domestic and global customers.
Giving ‘buy’ tag to the IPO, Anand Rathi report added, “At the upper price band company is valuing at P/E of 39x with a market cap of ₹ 18,043 million post issue of equity shares and return on net worth of 13.6%. We believe that company is fairly priced and recommend a “Subscribe- Long term” rating to the IPO.”
Advising investors to apply for the Divgi TorqTransfer Systems IPO, ICICI direct says, “We assign SUBSCRIBE for long term rating on DTS given that our bet in on future growth trajectory at the company as trailing valuations discount much of its healthy financial profile. We like DTS for its technical prowess in transmission space & incremental revenue streams coming on broad going forward in EV transmission as well as Dual Clutch transmission space.”
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Therightmag. We advise investors to check with certified experts before taking any investment decisions.