Mamata Machinery IPO subscribed 5.19 times on Day 1 so far. Check GMP, review and other key details

The initial public offering (IPO) of Mamata Machinery was fully subscribed on Thursday with an overall subscription of 5.19 times by 11:54 am on the first day of bidding. The IPO is an offer for sale (OFS) worth Rs 179 crore. The issue is set to close on December 23.

Subscriptions from retail investors stood at 8.25 times, while the non-institutional investors had subscribed by 4.75 times on the first day of bidding. The qualified institutional buyers have not made any bids yet.

Since the IPO is entirely an OFS, the proceeds from the offer will go to the selling shareholders.

Mamata Machinery IPO: GMP today

Ahead of the issue, Mamata Machinery's unlisted shares were trading at Rs 443 per share on Thursday in the unofficial market, reflecting a grey market premium (GMP) of 82.3% against the upper end of the IPO price band of Rs 243.

Mamata Machinery IPO: price band

The company has fixed a price band of Rs 230-243 per share, where investors can bid for 61 shares in one lot and in multiples thereafter.

Mamata Machinery IPO: Review

Analysts advised investors to subscribe to the issue as the IPO is fairly priced and the company enojys a niche in innovative plastic bags and pouch-making machines, packaging machines, and extrusion equipment.

At the upper price band, the company is valued at P/E of 16.6x with a market cap of Rs 599 crore post-issue of equity shares and return on net worth of 27.4% based on FY24.

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"On the valuation front, we believe that the company is fairly priced compared to their peers. Therefore, we recommend a subscribe
rating to the IPO," said Anand Rathi.

About Mamata Machinery IPO

Incorporated in 1979, Mamata Machinery manufactures and exports plastic bags and pouch making machines, packaging machines and extrusion equipment. It provides end-to-end manufacturing solutions for the packaging industry. Products manufactured using its machines are used across several industries as packaging applications, such as the packing of food and FMCG products.

It primarily sells packaging machinery to direct consumer brands catering to the FMCG, Food, & Beverage Industry and bag and pouch
making machines to convertors and service providers who, in turn, mainly catering the FMCG and consumer industry. MML’s machineries
are also utilized in non-packaging applications, such as e-commerce bags and garment packaging bags.

The company also provides after-sales service to customers. As part of its focus on innovation, it has launched new and advanced machines from time to time. It operates two machine manufacturing facilities, one in India and one in the US.

In FY24, Mamata's revenue from operations rose to Rs 237 crore from Rs 201 crore a year ago. The profit after tax in the same period increased to Rs 36.1 crore.

Mamata Machinery IPO: Opening Date, Allotment and Listing Date

Mamata Machinery IPO opened up for public subscription on December 19 with the issue closing on December 23. Meanwhile, the allotment for the IPO is expected to be finalised on December 24 and the listing of shares will be on December 27.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)