Sungarner Energies IPO Final Subscription Status

Sungarner Energies IPO closed on Wednesday, 23rd August 2023. The IPO had opened for subscription on 21st August 2023. Let us look at the final subscription status of Sungarner Energies Ltd at the close of subscription on 23rd August 2023. The IPO of Sungarner Energies Ltd was a fixed price issue with the IPO price being fixed at ₹83 per share. The stock has a face value of ₹10 per share.

About the Sungarner Energies IPO

Sungarner Energies IPO worth ₹5.31 crore comprises entirely of a fresh issue with no offer for sale (OFS) component. The Fresh Issue portion of Sungarner Energies Ltd entails the issue of 6,40,000 shares (6.40 lakh shares) which at fixed IPO price of ₹83 per share aggregates to ₹5.31 crore. The stock has a face value of ₹10 and retail bidders can bid in minimum lot size of 1,600 share each. Thus, the minimum investment of ₹132,800 in the IPO is the base limit. That is also the maximum that a retail investor can apply for in the IPO.

HNIs / NIIs can invest in a minimum of 2 lots of 3,200 shares worth ₹265,600 as the bare minimum investment. There is no upper limit for the HNI / NII category or even for the QIB category. Sungarner Energies Ltd will deploy the funds for working capital needs and for general corporate purposes. Post the IPO, the promoter equity in the company will get diluted from 84.94% to 61.49%. The issue is lead managed by Fast Track Finsec Private Ltd, while Skyline Financial Services Private Ltd will be the registrars to the issue. Let us now turn to the final subscription details of the IPO as of the close of subscription on 23rd August 2023, apart from the day-wise progress of the subscriptions.

Final subscription status of Sungarner Energies IPO

Here is the subscription status of the Sungarner Energies IPO as at close on 23rd August 2023.

The issue was open for retail investors, QIBs and for the HNI / NIIs. There was a broad quota designed for only two of these segments viz. retail and non-retail. The QIBs and the HNI / NIIs could apply under the non-retail category while the retail category had a separate reservation. The table below captures the allocation reservation done for each of the categories out of the total number of shares offered in the IPO. A total of 57,600 shares were allocated as market maker portion to Nikunj Stock Brokers Ltd, which will act as a market maker to provide bid-ask liquidity on the counter post listing. Market maker action not only improves liquidity in the counter but also reduces the basis risk.

The anchor portion had zero allocations from the start since there was no distinct QIB portion. However, the retail and the non-retail quota have been equally apportioned after the market maker shares are removed from the list.

How subscription built up for the IPO of Sungarner Energies Ltd

The oversubscription of the IPO was dominated by the HNI / NIIs followed by the retail investors and the QIB investors in that order. The table below captures the day-wise progression of the subscription status of Sungarner Energies Ltd IPO.

It is clear from the above table that both, the retail portion, and the non-retail portion comprising predominantly of the HNI / NII investors, got fully subscribed on the first day of the IPO itself. As a result, even the overall IPO was fully subscribed on the first day itself although most of the traction was seen only on the last day. Both the categories of investors viz., HNIs / NIIs and the retail categories saw good traction and build up of interest on the last day of the IPO. There is an allocation of 57,600 shares to Nikunj Stock Brokers Ltd for market making. The market maker offers two way quotes on the stock post listing using the inventory of shares and ensures that investors do not get overly worried about liquidity and basis risk in the early stages.

The IPO of Sungarner Energies Ltd opened for subscription on 21st August 2023 and closed for subscription on 23rd August 2023 (both days inclusive). The basis of allotment will be finalized on 28th August 2023 and the refunds will be initiated on 29th August 2023. In addition, the demat credits are expected to happen on 30th August 2023 and the stock is scheduled to list on 31st August 2023 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated.

A quick word on Sungarner Energies Ltd and the SME IPO

Sungarner Energies Ltd was incorporated in 2015. The company is engaged in the business of manufacturing Solar Inverters, Online UPS Systems, EV Chargers, and Lead Acid Batteries, which are some of the key inputs that go into the generation of solar energy and are also key inputs of solar and renewable energy related equipment. The company started off as a design engineering and solar EPC company and later diversified into higher end products. Today, the company makes power electronics and energy storage products also. Sungarner Energies Ltd also producers lead acid batteries of capacities ranging from 12 Volts 40 ampere-hours to 12 volts 300 ampere-hours.

Sungarner Energies Ltd has also obtained a WMI (world manufacturer identifier) code for the manufacture of EV Vehicles. This product is currently only in the prototype stage and there is still time for full-scale manufacturing of EV Vehicles. The major clients of Sungarner Energies Ltd come from the northern states of Haryana, UP, and Rajasthan as well as the eastern states of Bihar and Assam. The company has also established a total of 6 service Centres in India, across most of its key markets. At present, the company is planning to expand its footprint through additional 500 Franchisees across major Districts of India by the end of 2025. Sungarner Energies Ltd has also started exports in last 2 years and currently exports its products to countries like Nigeria, Lebanon, Nepal, Dubai, and Bhutan

The fresh issue portion will be used to fund working capital needs and for general corporate purposes. The issue will be lead managed by Fast Track Finsec Private Ltd while Skyline Financial Services Ltd will be the registrars to the SME IPO of Sungarner Energies Ltd.