Hindustan Aeronautics Limited (HAL) has opened its Initial Public Offer (IPO) on Friday. The company is looking to raise Rs 4,200 crore through the IPO.
Here are 10 key points an investor should note before subscribing to the issue:
• The face value of the share is fixed at Rs 10 per share. The issue price band for HAL IPO is Rs 1,215 to Rs 1,240 per share.
• The offer comprises a net offer of 3,34,38,750 equity shares and an employee reservation portion of up to 6,68,775 equity shares.
• For retail investors and eligible employees, there will be a discount on the issue. They will get shares at a discount of Rs 25 on the final offer price.
• State-owned defence company aims to raise Rs 4,144.06 crore and Rs 4,229.33 crore at lower and the upper end of the price band.
• The subscription opens on March 16 and closes on March 20.
• HAL IPO is a part of government's yearly divestment programme. HAL will not receive any proceeds from the IPO, and all the proceeds will go to the selling shareholder.
• SBI Capital Markets and Axis Capital Limited are the books running lead managers to the HAL IPO.
• By entering the primary market, the company aims to avail the benefits of listing the equity shares in the stock exchanges.
• HAL aims to carry out the disinvestment of 3,41,07,525 equity shares by the selling shareholder (the president of India). He is acting through the Department of Defence Production.
• Karvy Computershare Private Limited is the registrar to the issue.
HAL is the 39th largest aerospace company in the world in terms of revenue and Indian Army is its biggest client. HAL also supplies products overseas including Afghanistan, Namibia, Seychelles, Ecuador, Mauritius, Maldives, and Nepal.