Diffusion Engineers IPO GMP & Diffusion Engineers IPO Overview
Diffusion Engineers Limited, established in 1982, specializes in manufacturing welding consumables and wear-resistant plates, which are crucial components for heavy industrial equipment in sectors like cement, steel, power, and mining. The company has built a reputation for its expertise in welding consumables and wear plates, which are vital for protecting machinery used in high-wear conditions. Additionally, the company engages in the production of heavy machinery, catering to core industries such as nuclear, oil & gas, and sugar.
Past Performance
Diffusion Engineers has demonstrated solid financial growth over the past few years. Between FY2022 and FY2024, the company’s total revenue increased from ₹208.75 crore to ₹285.56 crore, marking a growth of 36.7%. The profit after tax (PAT) for the same period increased from ₹17.05 crore to ₹30.8 crore, reflecting a strong 39% rise. This performance is supported by forward integration in their production process, enabling cost efficiencies and better supply chain control.
Key Financials for FY2024:
- Total Revenue: ₹285.56 crore
- Profit After Tax: ₹30.8 crore
- Return on Equity (ROE): 18.52%
- Return on Capital Employed (ROCE): 20.63%.
IPO Statistics
[table “9” not found /]The allocation is divided into 50% for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and 35% for Retail Investors. Employees have been reserved 50,000 shares at a discount of ₹8 per share.
IPO Grey Market Premium (GMP)
The Grey Market Premium (GMP) for Diffusion Engineers IPO has been a hot topic. As of September 27, 2024, the GMP is ₹90 per share, indicating a potential listing gain of around 53.57%, bringing the expected listing price to approximately ₹258 per share.
What is GMP?
The Grey Market Premium (GMP)
GMP is the extra price that IPO shares command before their official listing. GMP is often considered an indicator of the demand and potential listing price of an IPO in the secondary market. A higher GMP typically signifies investor optimism and could lead to higher returns on the listing day.
Future Outlook of Diffusion Engineers
The future of Diffusion Engineers looks promising, supported by its expansion plans and favorable market conditions. The company plans to use the IPO proceeds for:
- Expansion of existing manufacturing facilities at Nagpur, Maharashtra.
- Setting up a new manufacturing facility to increase production capacity.
- Working capital requirements to fuel growth.
- General corporate purposes.
India’s welding consumables and wear plates market is expected to grow, driven by industrialization and infrastructure projects. The heavy engineering sector in which Diffusion Engineers operates is projected to grow at a CAGR of 7.5-8.5% until 2027, presenting numerous growth opportunities. The company’s focus on research and development, cost-efficient production, and strong client relationships will position it well to capitalize on industry growth.(
Percentage gains?