Diffusion Engineers IPO

Diffusion Engineers IPO: Key Details, Dates, and Highlights

Diffusion Engineers is set to launch its Initial Public Offering (IPO) from September 26 to September 30, 2024. The IPO is entirely a new equity sale worth ₹158 crore, with a price band of ₹159 to ₹168 per share. The funds raised will be used for expansion, working capital, and corporate purposes.

Key Dates and Details:

• IPO Open Date: Thursday, September 26, 2024
• IPO Close Date: Monday, September 30, 2024
• Price Band: ₹159 to ₹168 per share
• Offer Size: ₹158 crore (94.05 lakh shares)
• Minimum Bid: 88 shares per lot
• Basis of Allotment: Tuesday, October 1, 2024
• Initiation of Refunds: Thursday, October 3, 2024
• Credit of Shares to Demat: Thursday, October 3, 2024
• Listing Date: Friday, October 4, 2024
• Cut-off Time for UPI Mandate Confirmation: 5 PM on September 30, 2024

Allocation Details:

• Qualified Institutional Buyers (QIBs): 50%
• Non-Institutional Investors (NIIs): 15%
• Retail Investors: 35%

Company Overview:

Diffusion Engineers specializes in delivering advanced engineering solutions with over four decades of experience. The company offers products and services including:

• Specialized welding consumables
• Wear plates
• Heavy engineering equipment
• Repair and refurbishment services for heavy machinery
• Trading of anti-wear powders and welding/cutting machinery

Financial Highlights:

• Revenue (FY 2024): ₹285 crore, a 10% increase year-on-year.
• Net Profit (FY 2024): ₹30.8 crore, reflecting a 39% growth.
• Growth primarily driven by increased revenue from welding consumables, wear plates, and trading activities.

Use of IPO Proceeds:

The net proceeds from the IPO will be allocated towards:

1. Capital expenditure for expanding the existing manufacturing facility.
2. Establishing a new manufacturing site in Hingna.
3. Meeting working capital requirements.
4. Other corporate purposes.

About the Offering:

• Book-Building Process: The IPO is being conducted via this method, ensuring proportional allocation to different investor groups.
• Lead Manager: Unistone Capital is the exclusive book-running lead manager.
• Registrar: Bigshare Services is responsible for managing the allotment process.
• Stock Exchanges: The shares will be listed on both BSE and NSE.

Advantages of Investing in Diffusion Engineers IPO:

1. Strong Financial Growth: The company has demonstrated impressive revenue and profit growth over the past year, making it an attractive investment.
2. Established Industry Player: With over 40 years of experience, Diffusion Engineers is a trusted name in the engineering sector, providing services to both domestic and international markets.
3. Diversified Product Line: The company’s range of specialized products and services gives it a competitive edge, catering to critical industries with high demand for custom engineering solutions.
4. Expansion Plans: The proceeds from the IPO will be used for strategic expansions, including a new manufacturing site, setting the stage for future growth.

Risks and Considerations:

1. Market Volatility: As with all IPOs, the stock’s performance post-listing could be affected by broader market conditions and volatility.
2. Competitive Industry: The engineering solutions industry is highly competitive, and any slowdown in key industries like heavy machinery, construction, or manufacturing could impact the company’s growth.
3. Profit Margin Pressure: While the company has shown growth in profits, increasing costs related to expansion and working capital needs could put pressure on profit margins in the short term.

Conclusion:

Diffusion Engineers’ IPO presents an opportunity to invest in a well-established company with a strong track record in the engineering sector. The company’s steady revenue growth, ambitious expansion plans, and strategic use of funds make it a potentially attractive investment. However, investors should weigh the risks of market volatility and competition before deciding.

FAQs:

1. What is the price band for the Diffusion Engineers IPO?
   • The price band is set at ₹159 to ₹168 per share.
2. What is the size of the Diffusion Engineers IPO?
   • The IPO size is ₹158 crore, consisting of 94.05 lakh shares.
3. What will the IPO proceeds be used for?
   • The funds will be used for capital expenditure to expand manufacturing facilities, establish a new site in Hingna, meet working capital requirements, and cover general corporate expenses.
4. When will the Diffusion Engineers shares be listed?
   • The shares are expected to be listed on Friday, October 4, 2024.
5. Who is the lead manager for the Diffusion Engineers IPO?
   • Unistone Capital is the book-running lead manager for the IPO.
6. What is the minimum lot size for bidding in this IPO?
   • Investors can place bids for a minimum of 88 shares in a single lot, with additional shares available in multiples thereafter.

Diffusion Engineers IPO

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