IPO subscription frenzy
The IPO, which opened on September 11 and closed on September 15, witnessed a healthy subscription of over 301 times. Retail investors bid 330 times their allotted quota, while non-institutional investors subscribed 350 times. Qualified institutional buyers too poured in with 214 times subscription. In all, the issue received over 4.1 lakh applications, an unusually high number for an SME IPO, underscoring the intense buzz in the market.
The excitement for the IPO was driven by a mix of strong fundamentals, marquee projects, and market timing. Airfloa Rail Technology has carved a niche for itself as a key supplier to the Indian Railways’ modernization drive.
Its portfolio includes rolling stock components and turnkey interior projects for landmark trains such as the Vande Bharat Express, Agra-Kanpur Metro, RRTS, and Vistadome coaches. The company also caters to the aerospace and defence sectors, further strengthening its credentials.
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Investors are also attracted by the company’s robust financial performance. In FY25, Airfloa reported revenues of Rs 192.7 crore and profit after tax of Rs 25.6 crore, delivering healthy margins and strong return ratios — ROE at 30.6% and ROCE at 26.3%.The company has maintained EBITDA margins above 24%, reflecting operational efficiency in a capital-intensive sector.Moreover, the government’s continued push on railway modernization and defence indigenisation has provided a favourable backdrop.
IPO details
Priced at Rs 140 per share, the IPO comprised a fresh issue of 65.07 lakh shares. Proceeds are earmarked for capital expenditure (Rs 13.7 crore), repayment of borrowings (Rs 6 crore), and working capital needs (Rs 59.3 crore). The anchor book raised Rs 25.93 crore from investors a day before opening, further boosting confidence. Post-issue, promoter holding will fall from 74.4% to 54.2%.
Investors are advised to caution that such high premiums often attract profit-booking in early trades.
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