Fujiyama Power Systems IPO: 9% subscription on day 1; GMP 0 | Would you bid?

Kolkata: The bidding window for the Rs 828.00-crore Fujiyama Power Systems IPO was managed to attract bids wort 9% of the target amount overall -- 0.16 times in the retail category, 0.00 times in QIB (Ex Anchor) category and 0.05 times in the NII category. The issue mobilized Rs 247 crore from anchor investors from investors such as Nippon India Mutual Fund (MF), Tata MF, BNP Paribas, ValueQuest -- Investment Advisors, Societe Generale, LC Pharos Multi Strategy Fund, Astorne Capital and Citigroup Global Markets Mauritius.

Fujiyama Power Systems was set up in 2017. It manufactures equipment for the growing rooftop solar industry, including on-grid, off-grid, and hybrid solar systems. It has come up with a portfolio of over 522 SKUs, including solar inverters, panels, and batteries, to reduce customer reliance on alternative OEMs. The products include solar PCUs, off-grid, on-grid, and hybrid inverters, solar panels, PWM chargers, other battery chargers, lithium-ion and tubular batteries, online and offline UPS systems, solar management units, and charge controllers.

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The issue is a combination of fresh issue of 2.63 crore and OFS segment of 1 crore shares. Investors have been cold to the issue. The Grey Market Premium or GMP could not move beyond zero at all. It stood at that level on Nov 13 as well as Nov 14. Needless to say, it indicated a listing gain of 0. However, it must be remembered that GMP is an unofficial indicator that cannot guarantee anything -- gain or loss on listing.

Overt dependence on China for raw materials to manufacture its products appear as a key risk for the company. A few raw materials used in solar panels, inverters, solar cells, semiconductor devices and lithium-ion cells have to be imported from China. If there is problem in bilateral relations, production could suffer.

The Fujiyama Power Systems IPO price band has been fixed at Rs 216-228. The minimum investible lot for a retail investor is 65 shares, for which he/she has to pay Rs 14,820 as application money according to the upper end of the price band. The lot size investment for sNII is 14 lots while that of the bNII investors is 68 lots. Motilal Oswal Investment Advisors Ltd. is the book running lead manager and MUFG Intime India Pvt.Ltd. is the registrar of the issue.

IPO closes: Nov 17

Allotment: Nov 18

Initiation of refunds: Nov 19

Credit of shares to demat: Nov 19

Listing: Nov 20

Cut-off time for UPI mandate confirmation: 5 pm on Nov 17