Shares of drone-maker ideaForge Technology made a stellar debut and almost maintained the gains at the bourses.

The stock was listed at ₹1,305.10 reflecting a steep jump of 94.21 per cent from the issue price of ₹672 on the BSE. It hit an intra-day high of ₹1,344 but settled lower at ₹1,295.50 — up 92.78 per cent against the issue price. On the NSE, the stock opened at ₹1,300, touched a high of ₹1,343.95 and a low of ₹1,260, before settling at ₹1,294.95 — up 92 per cent.

The ₹567-crore initial public offering was subscribed 106.6 times. QIB portion was subscribed 125.8 times, while retail portion by 85 times and non-institutional investors by 80.58 times. Employee portion got subscribed by 96.58 times.

However, analysts advise investors to book profit in the stock as they see it would be difficult for the stock to maintain the gains given its rich valuation.

Prashanth Tapse, Sr VP Research Analyst at Mehta Equities Ltd, said: “Considering the overwhelming response from all types of investors followed by first-mover advantage, hence post listing the valuation would be stretched and difficult to sustain and we recommend allotted investors to book profits on the listing day while risky fancy investors can hold for medium- to long-term to play on drone demand.”

Anchor investors

The IPO comprised a fresh issuance of shares worth ₹240 crore and an offer-for-sale of 48.69 lakh equity shares by promoter and investors. As part of IPO process, ideaForge Technology mopped up ₹254.88 crore from 31 anchor investors such as Pinebridge Global Funds, Nomura Funds, Ashoka India Equity Investment Trust Plc, HSBC Mutual Fund, Goldman Sachs Funds, Carmignac Portfolio, Tata AIA General Insurance Company, ICICI Prudential Mutual Fund, Invesco India, Axis Mutual Fund, HDFC Mutual Fund, Nippon Life India, Aditya Birla Sun Life Trustee, Quant Mutual Fund and Max Life Insurance.

The net proceeds from the fresh issue will be utilised for repaying debts (₹50 crore), funding a working capital gap (₹135 crore), and investment in product development (₹40 crore), besides general corporate purposes.

ideaforge Technologies is a pioneer and the pre-eminent market leader in the Indian Unmanned Aircraft Systems (UAS) market with a share of approximately 50 per cent in fiscal 2022.