
Fabtech Technologies IPO: A Market Frenzy or a Wealth Creator?
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Fabtech Technologies’ IPO was subscribed nearly 20 times on its first day, with retail investors showing strong interest, subscribing 33.88 times, and Non-Institutional Investors (HNIs) at 13.54 times. By the second day of bidding, the subscription had surged to 158.87 times, indicating robust investor interest. The grey market premium (GMP) has been notably high, with reports indicating a GMP of Rs 80, suggesting a listing gain of around 94.12% at the upper price band of Rs 85 per share.
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Fabtech Technologies Cleanrooms Limited specializes in producing pre-engineered, prefabricated modular panels and doors for cleanroom construction in industries like pharmaceuticals, healthcare, and biotech. The IPO aims to raise Rs 27.74 crores, with the funds earmarked for long-term working capital, acquisition of equity shares of Kelvin Air Conditioning and Ventilation Systems Private Limited, and general corporate purposes.
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The company reported a revenue decrease of 22% and a profit after tax drop of 27% between FY23 and FY24, which might raise concerns about growth prospects. However, the company’s focus on niche markets and its comprehensive solutions could be seen as a positive for long-term growth if market conditions improve.
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The IPO’s high subscription rate and GMP suggest a market frenzy driven by the appeal of potential listing gains. Analysts and posts on X have generally advised applying for listing gains, with some highlighting the company’s decent fundamentals and valuations. However, there are also concerns about the sustainability of performance post-listing, as reflected in discussions questioning the future revenue numbers.
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While the Fabtech Technologies IPO seems poised for short-term market frenzy with significant listing gains due to high GMP and subscription, its role as a wealth creator in the long term is less certain. The company’s niche market and strategic use of IPO proceeds could foster growth, but investors should consider the financial performance dip and market volatility. For those looking at immediate returns, the IPO appears promising based on grey market trends, but for long-term investment, further due diligence on the company’s growth strategy and market conditions is advisable.
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