Paras Defence and Space Technologies makes bumper stock market debut; shares rally 171% over IPO price

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Paras Defence and Space Technologies stock made a stellar listing on the stock exchanges today, despite the general weak market momentum. Shares of Paras Defence and Space Technologies opened for trading at Rs 475 apiece, up 171.43% or Rs 300 per share from the difficulty price of 175 per share. On listing, the corporate had a market capitalisation of Rs 1,852 crore. The IPO (Initial Public Offering) of Paras Defence and Space Technologies, concluded earlier last month, saw a huge response from investors and was fully subscribed within the initial hour of sale. During the three-day bidding process, Paras Defence IPO was subscribed 304 times.

Paras Defence and Space Technologies is among the leading ‘Indigenously Designed Developed and Manufactured’ category Indian private sector companies catering to defence and space optics, defence electronics, EMP protection solutions and heavy engineering. the difficulty of the corporate was worth Rs 170 crore on the upper end of the worth band and was a mixture of fresh issue of equity shares and a suggestion purchasable (OFS) by existing shareholders.

Domestic brokerage and research firm Motilal Oswal had a ‘Subscribe’ rating on the difficulty given its complex/wide product portfolio, presence in niche defence space, strong client relationship and high entry barriers. “The issue is valued at 1.9x P/BV (peers avg: ~2.4x) on a post-issue basis, which is cheap . We believe PDSTL may benefit from government impetus on the defence and space expenditure,” analysts at Motilal Oswal had said during a report earlier

The company has seen its revenue take successful due to covid-19 but EBITDA margins expanded during the amount . Paras Defence and Space Technologies has negligible debt on its books which post IPO will further reduce to 0.2x. the corporate plans to use internet proceeds from the IPO to get machinery and equipment, fund incremental capital requirements and repay or prepay all or some of certain borrowings/outstanding loan facilities availed by the corporate .