Quadrant Future Tek Limited’s Initial Public Offering (IPO) has hit the primary market, opening doors for investors seeking a promising opportunity in the technology and manufacturing sector. With a price band set between ₹275 and ₹290 per share, the IPO has already garnered significant attention, driven by strong grey market activity and positive expert reviews.
Below is a comprehensive review of Quadrant Future Tek IPO, providing all the critical information to help you decide whether to invest.
1. Price Band and IPO Size
- Price Band: ₹275–₹290 per equity share.
- IPO Size: The public issue aims to raise ₹290 crore, entirely through a fresh issue of shares.
This fresh issue indicates that the proceeds will directly contribute to the company’s growth initiatives rather than funding existing shareholders’ exits.
2. Grey Market Premium (GMP)
Quadrant Future Tek shares have been trading at a premium of ₹181 in the grey market. This strong GMP reflects high demand and positive sentiment surrounding the IPO, potentially indicating a strong debut on the stock exchanges.
3. Subscription Status
On the first day of bidding, the IPO subscription status is as follows:
- Overall Subscription: 1.42 times.
- Retail Segment: 5.55 times.
- Non-Institutional Investors (NIIs): 1.49 times.
The robust subscription figures, particularly in the retail segment, highlight the strong interest from individual investors.
4. Lot Size and Minimum Investment
- Lot Size: 50 shares per lot.
- Minimum Investment: ₹13,750 to ₹14,500 (depending on the price band).
This makes the IPO accessible to both small and large investors.
5. Strategic Use of Proceeds
The ₹290 crore raised through this IPO will primarily be allocated to:
- Research and Development (R&D): Enhancing innovation capabilities.
- Working Capital Requirements: Strengthening operational efficiency.
- Market Expansion: Building strategic partnerships and expanding market presence.
6. Financial Performance
Quadrant Future Tek has demonstrated impressive financial growth in recent years:
| Metric | FY22 | FY24 | CAGR |
|---|---|---|---|
| Revenue (₹ million) | 1,042.5 | 1,518.2 | 20.6% |
| EBITDA (₹ million) | 95.0 | 366.6 | Significant Growth |
| Return on Equity (ROE) | N/A | 33% | – |
The strong growth trajectory and high ROE underline the company’s robust fundamentals.
7. Industry Outlook
Quadrant Future Tek operates in a dynamic sector with a large addressable market, particularly in defense-related technology and industrial automation. The company’s strategic Memorandum of Understanding (MoU) with RailTel Corporation and a ₹78.6 crore order from Chittaranjan Locomotive Works further solidify its position as a leading Original Equipment Manufacturer (OEM).
8. Lead Managers and Registrar
- Lead Manager: Sundae Capital Advisors, known for successfully managing high-profile IPOs.
- Registrar: Link Intime India Private Limited, ensuring seamless processing of applications and allotments.
9. Expert Opinions and Reviews
Abhishek Pandya, StoxBox Research Analyst
Pandya has given a “Subscribe” rating, emphasizing:
- Revenue growth at a CAGR of 20.6%.
- Strategic project wins and partnerships boosting the company’s long-term prospects.
- Valuation at a Price-to-Earnings (P/E) ratio of 59.1x, which is deemed fair in comparison to peers.
DR Choksey, Market Analyst
Choksey also assigned a “Subscribe” rating, citing:
- Strong financials and a robust ROE of 33%.
- Strategic wins in the KAVACH project, enhancing the company’s competitive edge.
- Valuation metrics (P/E of 79x and EV/EBITDA of 34x) are justified given the company’s growth potential and market leadership.
10. Should You Apply?
Quadrant Future Tek IPO offers a mix of solid fundamentals, promising growth prospects, and favorable market conditions. However, the high valuation may deter conservative investors. Key factors to consider before applying:
Reasons to Apply:
- Impressive financial performance and growth trajectory.
- Strategic project wins and strong market positioning.
- Positive sentiment in the grey market and among analysts.
Risks:
- High valuation metrics relative to peers.
- Dependence on a few large orders for revenue growth.
Final Thoughts
Quadrant Future Tek IPO has captured market attention for good reasons—its strong financials, promising industry outlook, and robust investor demand. While the high valuation may pose risks, the company’s long-term growth potential makes it an attractive opportunity for investors willing to take calculated risks.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Please consult your financial advisor before making investment decisions.
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