Hyderabad-based MTAR Technologies Rs 596-crore initial public providing (IPO) will open for subscription on Wednesday, March 3, 2021. Amid share industry volatility, MTAR Technologies shares in the grey industry have been commanding a premium of 75 per cent. MTAR Technologies shares have been trading at Rs 1,005, up Rs 430 more than the IPO cost in the grey industry on Monday. A precision engineering options enterprise has fixed the cost band of the problem at Rs 574-575 apiece. Analysts count on that with the government’s concentrate on space and defence sectors, and initiatives like Make in India and Atmanirbhar Bharat, businesses like MTAR Technologies can see enhanced possibilities.
Likhita Chepa, Senior Research Analyst at CapitalVia Global Research Limited has encouraged to ‘subscribe’ this problem with medium to extended term viewpoint though it has the prospective to produce decent listing gains. Chepa also mentioned that MTAR has been a important companion to Indian Space Research Organization (ISRO), Defense Research and Development Organization, Nuclear Power Corporation of India Limited (NPCIL) and the US-based Bloom Energy, apart from catering to many substantial Indian entities such as Bharat Dynamics and Hindustan Aeronautics in aerospace and defence. The enterprise is also working with Israel- based Rafael Advanced Defense Systems and Elbit Systems on the exports front.
MTAR Technologies’ income grew at a CAGR of 17 per cent whilst PAT grew by 140 per cent CAGR in the previous 3 years. “Its portfolio also looks well diversified as it is not majorly dependent on one category or sector for its operations and revenue,” Chepa told TheSpuzz Online. It has an aggregate order book of Rs 336.2 crore as on December 31, 2020.
Those at Geojit Financial Services Ltd have also offered a ‘subscribe’ rating to the problem as MTAR Technologies is a powerful player in the booming precision engineering business. At the upper cost band of Rs 575, MTAR is offered at a P/E of 47.3x (annualized basis on FY21E EPS of Rs 12.2) which is aggressively priced. “With no listed peers and positive sentiment in space & defence sectors due to Make in India and Atma Nirbhar Bharat with limited competition for the products they manufacture, we assign a Subscribe rating, with a long term perspective,” they mentioned.
Considering TTM adjusted EPS of 12 on a post-problem basis, Marwadi Shares and Finance Ltd mentioned that MTAR Technologies is going to list at a P/E of 47.9X with the industry cap of Rs 1,769 crores. There are no listed entities in India that are engaged in a equivalent line of business enterprise and whose business enterprise is comparable with that of this business enterprise. Marwadi Share & Finance Limited has also offered a ‘subscribe’ rating to the IPO.