Paras Defence and Space Technologies Limited's IPO saw overwhelming response from all the category of investors. It received bids of 2,17,26,31,875 shares against the offered 71,40,793 equity shares, as per the 5:00 pm data available on the bourses.
The portion reserved for the Non-Institutional Investor category was subscribed 927.70 times and the retail investors was subscribed 112.81 times and, While the Qualified Institutional Buyer category was subscribed 169.65 times.
The issue was subscribed 304.26 times making it the most subscribed IPO in the history, followed by Salasar Technologies with 273.05 times, Apollo Micro Systems was subscribed 248.5 times.
Other IPOs that made into the list of most subscribed include Astron Paper & Board Mill with 241.8 times, Mrs. Bectors(198 times), Capacite Infraprojects(183 times), Ujjivan Small Finance Bank (165.7 times), and Amber Enterprises (165.4 times).
The Offer was comprising of a fresh issuance of Equity Shares aggregating up to ₹ 140.6 crores ("Fresh Issue") and an offer for sale of up to 17,24,490 Equity Shares by Selling Shareholders.
Defence has remained a focus area for the government and Indian companies are seen as key beneficiaries of the Centre's schemes such as Atmanirbhar Bharat and Make in India. While the same will benefit Paras Defence, the company's strength lies in its R&D and relationship with diverse customers.
Global defence spending is estimated to have touched US$1.98 trillion (tn) in 2020 with 2.6% YoY growth. Five largest spenders account for ~62%, including US, China, India, Saudi Arabia and Russia. India defence expenditure has been on a constant growth trajectory, largely on account of rising conflicts & border tensions with neighbours viz. China and Pakistan in addition to cross-border terrorism threats. The contribution of defence expenditure to GDP has risen from 2.2-2.3% to ~3% over a decade. The Indian Air Force (IAF) comprises more than ~39%of the defence capital outlay followed by the Army and Navy at 27% and 25%, respectively.
Anand Rathi Advisors Limited is the book running lead manager to the Offer ("BRLM").
As per the "Defence and Space Industry Report" prepared by Frost & Sullivan ("F&S Report"), the Company, is amongst India's leading private sector Company catering to four major segments of Indian defence sector namely, defence optics, defence electronics, electro-magnetic pulse ("EMP") protection solution, and heavy engineering for defence and niche technologies. The Company is the sole Indian supplier of critical imaging components such as large size optics and diffractive gratings for space applications in India. The Company manufactures high precision optics for the defence and space applications such as thermal imaging and space imaging systems. As per the F&S Report, it is the only Indian Company to have the design capability for space-optics and opto-mechanical assemblies.
The Company has contributed towards some of the most prestigious defence programmes; and under its defence electronics operations it has managed to provide a wide array of high performance computing and electronic systems for defence applications, including sub systems for border defence, missiles, tanks and naval applications. The Company has undertaken and delivered customized turnkey projects in the defence segment, especially in the defence electronics and EMP protection segments. Currently, the Company operates through two manufacturing facilities in Maharashtra, located at Nerul (Navi Mumbai) and Ambernath (in Thane).
At the domestic front, the Company's customer base ranges from government organizations involved in defence and space research to various defence public sector undertakings like Bharat Electronics Limited (BEL), Electronic Corporation of India Limited (ECIL) and Hindustan Aeronautics Limited (HAL); and supply products and solutions to private entities including Tata Consultancy Services Limited, Solar Industries India Limited and Alpha Design Technologies Limited. The Company has also catered to various foreign customers.