MTAR Technologies's Rs 600-crore initial public offering will open for subscription today(March 3) and close on March 5. The company has set the price band for the issue at Rs 574-575 per share.

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This is the ninth IPO to hit the market so far in 2021. The others were Indigo Paints, Home First Finance Company, Nureca, Stove Kraft, Brookfield India REIT, Indian Railway Finance Corporation, RailTel Corporation of India and Heranba Industries.

Here's all you need to know about the issue:

Opening Date: March 3, 2020

Closing Date: March 5, 2020

About the firm: Hyderabad-based MTAR Technologies is a leading player in the precision engineering industry. The company is engaged in the manufacturing of mission-critical precision components. The company serves customers in the clean energy, nuclear, space and defence sectors. Its clients include ISRO, Rafael, DRDO and NPCIL.

At present, the firm has 7 manufacturing facilities in Hyderabad, Telangana that undertake precision machining, assembly, specialized fabrication, brazing and heat treatment, testing and quality control, and other specialized processes.

Size of the issue: Rs 600 crore

The company has already raised Rs 100 crore through a pre-IPO placement and the fresh issue size has been reduced by 18.51 lakh equity shares to 21.48 lakh shares. Also, the promoters will offering 82.24 lakh equity shares in the issue.

Minimum Bid: Investors can bid for a minimum of 26 equity shares and in multiples of 26 shares, thereafter.

Objective: Proceeds from the fresh issue of shares will be used towards repaying debts and for working capital .

Book runners: JM Financial and IIFL Securities are the book-running lead managers to the issue.

Financials: The company's revenues have grown at a compounded annual rate of 16.5 percent over the last 3 years. Its operating profit margin stood at 28.5 percent in FY20.

Order Book: MTAR Technologies' aggregate order book as on December 31, 2020, was Rs 336 crores, comprising orders from the clean energy sector, the nuclear sector and space and defence sectors, of Rs 80 crores (24 percent), Rs 93 crores (28 percent) and Rs 160 crores (48 percent), respectively.

Outlook: "At the higher price band of Rs 575, the stock is valued at 20x FY20 earnings of Rs 28.3 and commands premium considering its healthy order book, visibility of topline growth, competitive edge, superior profitability as compared to peers, return ratios, wide clientele spread across the globe, sound R&D base and technological progress. We recommend investors to SUBSCRIBE to the IPO of MTAR," said LKP Securities.

First Published:Mar 2, 2021 11:28 AM IST