Nova Agritech had a favorable market debut, as its shares were listed at a 36.5 percent premium over the IPO price on January 31. Opening at Rs 55 on the NSE and Rs 56 on the BSE, compared to the issue price of Rs 41, the stock performed well. Analysts had anticipated a listing with a premium ranging between 40-70 percent, potentially reaching Rs 58 to 72.
Before the listing, Nova Agritech shares were trading at a 30 percent premium in the grey market, an unofficial trading platform where shares are transacted before IPO allotment and continue until the listing day. Investors often monitor the grey market premium (GMP) to gauge the expected listing price.
The IPO garnered significant investor interest, receiving an oversubscription of 109.37 times. High net-worth individuals (HNIs) took the lead, subscribing 227.19 times their allocated quota. Retail investors exhibited strong interest by subscribing 77.12 times the portion reserved for them, while qualified institutional buyers subscribed 79.31 times.
The IPO, open for subscription from January 23 to January 25, included a fresh issue of 2.73 crore shares valued at Rs 112 crore and an offer-for-sale of 77.58 lakh shares valued at Rs 31.81 crore. The price band for the offer was set at Rs 39-41 per share.
Proceeds from the issue will be allocated as follows: Rs 14.20 crore for investing in subsidiary Nova Agri Sciences to establish a formulation plant, Rs 10.49 crore for funding the capital expenditure of Nova Agritech and expanding its existing plant, Rs 26.65 crore for meeting working capital requirements, and Rs 43.36 crore for investing in Nova Agri Sciences.
The promoters of the company include Suraksha Agri Retails (India), Malathi S, and Kiran Kumar Atukuri. The book-running lead managers for the IPO were Keynote Financial Services and Bajaj Capital, with Bigshare Services serving as the registrar.
Nova Agritech operates as an agri-input manufacturer, specializing in soil health management, crop nutrition, and crop protection products. The company adopts a technology-driven and farmer-centric solution approach, emphasizing ecologically sustainable and nutritionally balanced products derived from its research and development (R&D) efforts. The production of crop protection products is carried out through its subsidiary, Nova Agri Sciences.