ASK Automotive Shares Debut on Stock Market with an 8% Premium Above IPO Price

15 Nov, 2023

ASK Automotive Shares Debut on Stock Market with an 8% Premium Above IPO Price

ASK Automotive marked a stellar stock market debut, opening at an 8.1% premium over its initial public offering (IPO) price. The BSE listed the ASK Automotive shares at ₹304.9, surpassing the ₹282 issue price, while the NSE reported an opening at ₹303.3, reflecting a 7.55% increase over the IPO price.

Post-listing, ASK Automotive shares witnessed a substantial surge, reaching as high as ₹311.75, contributing to a market capitalization of ₹6,114.4 crore.

Market analysts anticipated the listing to align with expectations, considering the stock's ₹28 premium in the grey market, hinting at a listing price around ₹310 per share.

Despite strong fundamentals, ASK faced challenges with higher valuations and a 100% offer for sale (OFS), limiting potential listing gains, as noted by market experts.

The ₹834-crore IPO, entirely comprising an OFS by promoters Kuldip Singh Rathee and Vijay Rathee, garnered significant interest from investors, particularly institutional buyers. The oversubscribed offer received bids for 105.85 crore shares against the 2.06 crore shares available.

Qualified institutional buyers (QIB) demonstrated robust interest, subscribing 142.4 times, while non-institutional investors (NII) and retail investors subscribed at 35.5% and 5.7 times, respectively. ASK allocated half of the public issue to QIBs, 15% to NIIs, and the remaining 35% to retail investors, as per the SEBI document.

ASK had set the IPO price band at ₹268-282 per share, with a lot size of 53 equity shares and multiples thereafter. Retail investors could apply for a minimum of ₹14,946 (1 lot) and a maximum of ₹194,298 (13 lots).

Before the IPO, ASK raised ₹250.2 crore from anchor investors, including Morgan Stanley, Copthall Mauritius, Goldman Sachs, Societe General, BNP Paribas, and others.

Established in 1988, ASK Automotive claims to be India's largest manufacturer of brake-shoe and advanced braking systems for two-wheelers, with 15 manufacturing units across five states as of June 2023.