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The Happy Forgings issue closes for public subscription today. The IPO has been subscribed 7.47 times so far on the back of a strong response from small and wealthy retail investors. Priced in a band of ₹808–850, the IPO received bids for 1.94 crore shares, against 89.65 lakh shares on offer.
About the offer
The market lot is 17 shares. The public issue comprises a fresh issue of ₹400 crore and an Offer-for-Sale (OFS) of up to 71.60 lakh shares worth ₹609 crore.
The quota set aside for retail investors was bid 7.42 times, while that for non-institutions, generally referred to as high networth individuals, was subscribed 16.50 times. The QIB portion was subscribed 0.45 times.
The issue is being made through the book-building process, wherein not more than 50 per cent will be available for allocation to qualified institutional buyers, not less than 15 per cent to non-institutional bidders, and not less than 35 per cent to retail investors.
Anchor investors
Ahead of its initial public offering, the company allotted about 35.60 lakh shares at ₹850 a share to 25 anchor investors, raising ₹303 crore.
Global investors such as Fidelity International, Neuberger Berman, Morgan Stanley, Janchor Partners, WhiteOak Capital, Eastbridge Capital and Kotak Offshore participated in the anchor book. As many as 14 mutual funds, including SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, Nippon India Mutual Fund, Kotak Mahindra Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, DSP Mutual Fund, Edelweiss Mutual Fund, Canara Robeco Mutual Fund, Invesco Mutual Fund, Motilal Oswal Mutual Fund, Quant Mutual Fund and HSBC Mutual Fund, and long with insurance companies such as SBI Life Insurance, ICICI Prudential Life Insurance, HDFC Life Insurance and Birla Life Insurance also participated.
Issue proceeds
The company proposes to use the issue proceeds for the purchase of equipment, plant and machinery, prepayment of all or a portion of certain outstanding borrowings availed and for general corporate purposes.
About Happy Forgings
Incorporated in July 1979, Happy Forgings manufactures heavy forgings and high-precision machined components. HFL primarily serves domestic and global original equipment manufacturers of commercial vehicles in the automotive sector. In the non-automotive sector, it caters to manufacturers of farm equipment, off-highway vehicles, and manufacturers of industrial equipment and machinery for oil and gas, power generation, railways and the wind turbine industries.
The company owns and operates three manufacturing facilities, of which two are located at Kanganwal and Dugri in Ludhiana, Punjab. The annual aggregate installed forgings and machining capacity stands at 120,000 mt and 47,200 mt as of September 30, 2023, respectively.
Financial performance
In the six months ended September 30, 2023, the company posted a revenue of ₹672.90 crore and re-stated profit of ₹119.30 crore.
JM Financial Ltd, Axis Capital Ltd, Equirus Capital Private Ltd and Motilal Oswal Investment Advisors Ltd are the book-running lead managers, and Link Intime India Pvt Ltd the registrar to the offer.
The equity shares are proposed to be listed on the BSE and NSE.
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