The initial public offering (IPO) of Hindustan Aeronautics (HAL) was subscribed 0.99 times on Tuesday, the concluding day of the offer, with investors bidding for 3.36 crore shares against 3.41 crore shares reserved for them. Qualified Institutional Buyers bid for 1.73 times the shares offered to them, high net worth individuals bid for 0.03 times their allocation, retail investors 0.38 times and employees 0.21 times.
The IPO of the government-owned aerospace company had a price band of Rs 1,215 to Rs 1,240 per share. The IPO was an offer for sale of 3.41 crore shares. Retail investors were given a discount of Rs 25 per share on the offer price.
The 100% offer-for-sale constituted 10.20% of the post-offer paid up equity share capital of the company. The offer was part of the disinvestment programme of the government, and all the proceeds will go to the central exchequer.
The company is engaged in the design, development, manufacture, repair, overhaul, upgrade and servicing of a range of products including, aircraft, helicopters, aero-engines, avionics, accessories and aerospace structures. The company has 20 production divisions and 11 research and design centers (R&D Centres) located in India. As of December 31, 2017, the company had an order book worth Rs 68,461 crore, which includes products and services to be manufactured and delivered.
For the six-month period ended September 30, 2017, Indian Defence Services accounted for 91.4% of the company’s total sales. The company posted a net profit of `391 crore for the period ended September 2017 and `2,624 crore for the year ended March 2017.
Hindustan Aeronautics joins a long list of companies that have raised funds from the market in the recent past. In 2017, 36 companies raised Rs 67,147 crore through IPOs. Listing gains and the positive sentiment in the market are among the reasons attributed to the trend.