Delta Autocorp IPO Sees Strong Grey Market Premium and Overwhelming Demand
Delta Autocorp, a rising electric vehicle (EV) manufacturer specializing in 2-wheelers and 3-wheelers, has generated significant buzz in the market as its Initial Public Offering (IPO) closes for subscription on January 9, 2025. The company is seeing a strong grey market premium (GMP), with its shares trading at a premium of 89.23 per cent, or Rs 116 higher than the upper end of the issue price of Rs 130. This brings the grey market price of Delta Autocorp’s shares to Rs 246 as of Thursday, January 9, 2025.
IPO Subscription Details
The IPO, which opened for subscription on January 7, 2025, has witnessed an overwhelming response from investors. According to the National Stock Exchange (NSE), the IPO was oversubscribed by an astounding 127.90 times by 01:02 PM on January 9, 2025. This high demand further boosts investor confidence in the company’s potential growth in the electric vehicle sector.
IPO Structure and Pricing
Delta Autocorp’s IPO is a book-built issue worth Rs 54.60 crore, consisting of:
- A fresh issue of 3,888,000 equity shares
- An offer for sale of 312,000 equity shares
The company had already raised Rs 15.21 crore from anchor investors as of January 6, 2025.
The price band for the IPO is set between Rs 123 and Rs 130 per share, with a lot size of 100 shares, requiring a minimum investment of Rs 1,30,000 for retail investors. The Registrar for the issue is Link Intime India Private, while GYR Capital Advisors is acting as the sole book-running lead manager.
Expected Timelines and Allotment Process
The basis of allotment for the shares is expected to be finalized on Friday, January 10, 2025. After the allotment process, shares are anticipated to be credited into the demat accounts of investors by Monday, January 13, 2025. The company is expected to list on the NSE SME platform on Tuesday, January 14, 2025.
Company’s Use of Proceeds
Delta Autocorp plans to utilize the fresh proceeds from the IPO for the following purposes:
- Establishing an Electric Three-Wheeler Fabrication and Painting Plant
- New product development to expand their EV portfolio
- Working capital requirements
- General corporate purposes and covering offer expenses
It is important to note that Delta Autocorp will not receive any proceeds from the offer for sale, as the funds will be directed to the selling shareholders, after covering taxes and offer expenses.
Company Background
Delta Autocorp manufactures and sells electric two-wheelers (2W) and three-wheelers (3W) under the Deltic brand, utilizing high-quality components sourced from reputed Original Equipment Manufacturers (OEMs). The company initially focused on the development of electric three-wheeler prototypes and launched its first E-Rickshaw in 2017.
With the increasing adoption of electric vehicles in India and globally, Delta Autocorp is positioned to capture a significant market share in the burgeoning EV sector. The company’s focus on innovation and quality in electric mobility products has contributed to its strong market position and investor interest.
