Cyient DLM, an integrated electronic manufacturing services provider, experienced tremendous demand from institutional and retail investors during its IPO. The issue was subscribed a remarkable 67.3 times on the final day. Retail investors showed a lot of interest by subscribing 49.2 times, while non-institutional investors subscribed 45.05 times. Qualified institutional buyers made bids that were 90.44 times higher than the amount reserved for them.
The IPO of Cyient DLM garnered significant attention and participation from investors, resulting in an overwhelming oversubscription. Retail investors showed immense interest, subscribing 49.2 times, while non-institutional investors demonstrated their confidence with a subscription rate of 45.05 times. Qualified institutional buyers (QIB) made bids that surpassed the reserved amount by a staggering 90.44 times.
Industry analysts monitoring the unlisted market have reported a premium of Rs 110-112 on Cyient DLM's shares, representing over 40% compared to the upper end of the price band set at Rs 265.
Cyient DLM Ltd (CDL) specializes in integrated electronic manufacturing services and solutions, catering to the complete life cycle of a product, including design, build, and maintenance. The company has built long-standing relationships with renowned clients like Honeywell, Thales Global Services, ABB, Bharat Electronics, and Molbio Diagnostics, with an average tenure of over 11 years.
Analysts have assessed that Cyient DLM, at the upper price band, is available at a price-to-earnings (P/E) ratio of 66.2x FY23 earnings, aligning with valuations of its industry peers.
In the financial year ending March 2023, Cyient DLM witnessed a 15% growth in revenue from operations, reaching Rs 832 crore. The company's profit for the same period stood at Rs 31.7 crore, showing a 4% rise.
Printed circuit board assembly (PCBA) contributes to the major share of Cyient DLM's revenue, accounting for 63%, while 32% of the revenue is generated from box builds utilized in critical systems such as cockpits, landing systems, inflight systems, and medical diagnostic equipment.
The net proceeds from the IPO will be utilized to meet incremental working capital requirements, debt repayment, capital expenditure, and other general corporate purposes.
Axis Capital and JM Financial are the book-running lead managers for the IPO, and KFin Technologies is the registrar. The oversubscription of Cyient DLM's IPO underscores the strong investor confidence and positive market sentiment surrounding the company's growth prospects.