Yashhtej Industries IPO Subscribes 12% on Day 1; Retail Portion Shows Strength Amidst Cautious NII Bids

Yashhtej Industries IPO Sees Modest Initial Subscription on Day 1

Yashhtej Industries' Initial Public Offering (IPO) commenced on Wednesday, February 18, with a subscription rate of 12% by the end of its first bidding day. The IPO, which is scheduled to close on Friday, February 20, aims to raise capital for the company's operations in soybean oil production and processing, as well as its diversification into solar power generation.

Key Developments

• Subscription Status: On its opening day, the Yashhtej Industries IPO had garnered bids for 9,42,000 shares against a total of 76,75,200 shares on offer. This represents a 12% subscription rate as of 13:39 IST on the first day, according to data from chittorgarh.com.
• Segment Performance: The retail investor portion showed stronger interest, with a subscription rate of 22%. In contrast, the Non-Institutional Investor (NII) portion was subscribed at a lower rate of 2%.
• IPO Details: The issue price band for Yashhtej Industries IPO has been set at ₹110 per equity share, with each share having a face value of ₹10. Investors are required to place bids for a minimum of 1,200 equity shares, and subsequent bids must be in multiples of 1,200.
• Company Background: Founded in 2018, Yashhtej Industries (India) Limited specializes in the production and processing of soybean crude oil through solvent extraction and the manufacture of Soybean De-Oiled Cake (DOC), a protein-rich by-product.
• Business Operations: The company operates in the business-to-business (B2B) sector, supplying crude oil to refineries. It has also expanded its business to include solar power generation and supply.
• Valuation Context: As per the company's prospectus, its Price-to-Earnings (P/E) ratio stands at 14.27x. Its listed peers include KN Agri Resources Ltd with a P/E of 11.52x and Rama Phosphates Ltd with a P/E of 41.26x.

Business Impact

The initial subscription figures suggest a cautious market reception on the first day. The company's ability to attract a broader investor base, particularly from NIIs, will be crucial in the coming days to ensure a successful IPO. The funds raised are expected to support the company's ongoing operations and potential expansion.

Market Context

The IPO market remains dynamic, with investor sentiment often influenced by early subscription trends and overall market conditions. The performance of similar companies in the agri-processing and energy sectors can also play a role in investor perception.

Industry Context

Soybean processing is a significant segment within the edible oil industry, driven by demand for both edible oils and animal feed (DOC). The diversification into solar power aligns with the growing emphasis on renewable energy sources in India.

Looking Ahead

Investors will be closely monitoring the subscription levels on the remaining bidding days, particularly the performance of the NII and Qualified Institutional Buyer (QIB) portions, to gauge the overall demand for the Yashhtej Industries IPO.