IdeaForge makes blockbuster debut; lists at 94% premium
Shares of homegrown drone maker ideaForge Technology made a stellar debut on the stock exchanges on Friday, with the share price listing at ₹1,305.10 on the BSE, a premium of 94.2% against the upper end of the IPO price band of ₹672. On the NSE, the stock opened at ₹1,300 apiece, in line with market expectations.
Post listing, ideaForge share price rose as much as 100% to ₹1,344 on the BSE, while it touched a high of ₹1,343.95 on the NSE. It hit a low of ₹1,257.80 and ₹1,270 on the BSE and the NSE, respectively. On the volume front, a total of 51.98 lakh shares changed hands over the counter on the BSE and the NSE. The market capitalisation stood at ₹5,366 crore at the time of reporting.
Meanwhile, the BSE Sensex was trading 49 points lower at 65,737, and the Nifty50 was down 29 points at 1,271 level.
The ₹567-crore initial public offering (IPO) of IdeaForge, the market leader in the Indian unmanned aircraft systems (UAS) market, had received overwhelming response from investors. The issue was subscribed 106 times on the back of strong responses from qualified institutional buyers (QIBs) and retail individual investors. The quota reserved for QIBs was booked 125.8 times, followed by retail individual investors (RIIs) (84.8 times), while the non-institutional investors’ (NII) portion was subscribed 80.57 times so far. The portion reserved for employees was booked 95.8% times.
IdeaForge has set a price band for the offer at ₹638 to ₹672 per equity share with a lot size of 22 shares. The issue, which opened for subscription on June 26 and closed on June 30, comprised fresh issuance of shares worth ₹240 crore, and an offer for sale of 48.69 lakh equity shares by selling shareholders.
The company intends to deploy the net proceeds from the issue to repay or prepay certain indebtedness, fund the working capital gap, invest in product development, and general corporate purposes. As of March 31, 2022, ideaForge Technology had a total assets of ₹487.9 crore. The consolidated financials show it recorded a profit worth ₹40.7 crore as of March 31, 2023, and its income stood at ₹196.4 crore.
The company, in consultation with the BRLMs, had undertaken a pre-IPO placement worth ₹60 crore, which is why the size of the fresh issue has been reduced by ₹60 crore to up to ₹240 crore. Ahead of the IPO, IdeaForge raised ₹255 crore from 31 anchor investors on June 23.
The company allocated 37.93 lakh equity shares at upper end of the price band of ₹672 apiece. The key investors that participated in the bid include Goldman Sachs Funds, Nomura Funds Ireland Public Ltd, Pinebridge Global Funds, Tata AIG General Insurance Company, Tata AIA Life Insurance Company, and Max Life Insurance Co. Meanwhile, domestic mutual funds including ICICI Prudential Mutual Fund (MF), HDFC MF, Axis MF, Nippon India MF, Aditya Birla Sun Life MF, Quant MF, and Motilal Oswal MF also participated in the anchor round.
ideaForge claims to be the pioneer and the pre-eminent market leader in the Indian unmanned aircraft systems market, with a market share of approximately 50% in Fiscal 2022, as per the 1Lattice report. The company had the largest operational deployment of indigenous UAVs across India, with an ideaForge-manufactured drone taking off every five minutes on average for surveillance and mapping during the nine months that ended December 31, 2022. The company is ranked 7th globally in the dual-use category (civil and defence) drone manufacturers as per the report published by Drone Industry Insights in December 2022.
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