Gala Precision Engineering IPO subscribed nearly 11 times on day 1. Check GMP, other details

The initial public offering (IPO) of Gala Precision Engineering, which opened for bidding today, was oversubscribed on the day 1 of the process. The issue was subscribed by 10.83 times by the end of the day. The retail portion was subscribed 12.14 times while the non-institutional investor (NII) category was booked 20.71 times on strong demand. The employee reserved category was subscribed 38.31 times while the portion reserved for the qualified institutional buyers (QIBs) was booked 86% at the end of the day.

Meanwhile, the current grey market premium (GMP) for Gala Precision Engineering is Rs 270, representing a 51% premium in the unlisted market.

Some promoter and promoter group entities are participating in the OFS, offloading 510,000 shares. Additionally, other individual investors are also partially reducing their stakes.


The proceeds from the fresh issue will be used to establish a new facility at Vallam-Vadagal for manufacturing high-tensile fasteners and hex bolts, fund capital expenditures for equipment, plant, and machinery at Wada, Palghar, repay debt, and cover general corporate purposes.

Gala Precision Engineering IPO price band

The issue is priced in the range of Rs 503-529 per share, with investors able to bid for 28 shares per lot and in multiples thereafter.

Gala Precision Engineering IPO review

Analysts have given a thumbs-up to the IPO, citing the company's dominant market position, global Tier-1 client base, and attractive valuation.

"At a higher price band, GPEL is demanding an EV/Sales multiple of 2.9x, which is at a discount to peer average of 4.7x. Thus the issue is attractively priced," said Choice Equity Broking while assigning a 'subscribe' rating.
"The IPO's valuation aligns with industry benchmarks. Given current market trends and the increasing demand for precision components, GPEL is poised for a successful listing and sustained growth," said Swastika Investmart.

Other details

Gala Precision Engineering specializes in manufacturing niche precision components critical to various end-user applications. The company produces disc springs, strip springs, and wedge lock washers essential for the renewable energy, industrial, and mobility sectors. Disc springs are used in industrial applications requiring mechanical force, providing powerful spring forces in a compact space.

The company's technical springs and high-tensile fasteners are supplied to customers in countries such as Germany, Denmark, China, Italy, Brazil, the USA, Sweden, and Switzerland.

Analysts expect continued strong demand for Gala Precision Engineering's products from key sectors like renewables, industrials, and railways.


For FY24, the company’s revenue from operations increased by 22% to Rs 202 crore, driven by higher sales of disc springs due to new customers and increased demand from the renewable energy, railways, and industrial sectors, along with increased sales of strip springs. The profit after tax for the same period was Rs 22.33 crore.

PL Capital Markets is the sole book-running lead manager, and Link Intime India Private is the registrar to the issue.

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