After Successful IPO, Sachin Tendulkar-Backed Azad Engineering's Shares To Get Listed This Week

When the shares of Hyderabad-based aerospace components and turbines manufacturer company Azad Engineering get listed on the stock exchanges this week, cricketing legend and master blaster Sachin Tendulkar is expected to make multi-bagger returns within just 9 months from the time he invested in it.

What Returns Sachin Tendulkar Is Expected To Get From The IPO?

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Considering the upper band of the issue price at Rs 524 per share, the market value of Tendulkar's Rs 5-crore investment would increase to Rs 22.96 crore, translating into a notional gain of 360%.

His fortunes can, however, increase or decrease on the listing day, as per ET. Going by the grey market premium (GMP), shares of Azad Engineering are likely to list 65% higher than the IPO issue price. On March 6, Tendulkar had reportedly picked up equity worth about Rs 5 crore in the company. Following a stock split and bonus issue ahead of the IPO, he now owns 438,210 shares of the company. His average cost of acquisition is just Rs 114.1 per share.

The Rs 740-crore IPO, whose subscription ends on Friday, comprises a fresh equity issue of Rs 240 crore and an offer for sale (OFS) of Rs 500 crore. Under the OFS, promoter Rakesh Chopdar, investor Piramal Structured Fund, and DMI Finance are offloading stakes but not the cricketer.

Also Read: 6 Money Lessons You Can Learn From The Game Of Cricket

Who Are The Other Athletes Who Have Invested In The Company?

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The IPO isn't good news just for Sachin Tendulkar but also also three other sports personalities ¡ª PV Sindhu, Saina Nehwal and VVS Laxman ¡ª as their Rs 1 crore investment would rise to Rs 2.3 crore, a handsome return of 130%.

Five days after Master Blaster's entry, all three sportspersons went ahead and made investments of Rs 1 crore each in Azad Engineering by buying 43,800 shares each on March 11. However, they ended up paying a higher price as the average cost of acquisition was Rs 228.17 per share. However, they are still likely to make multi-bagger returns from the IPO, as per the ET report.

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When Is Azad Engineering Shares' Listing?

The shares of Azad Engineering are expected to be listed this week on 28 December. At the upper price band of Rs 524, the company is asking for a market capitalisation of Rs 3,098 crore. Based on annualized FY24 earnings and fully diluted post-IPO paid-up capital, the PE would be 57x.

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Also Read: Sachin's 50th Birthday: 5 Money Lessons We Can Learn From The Master Blaster's Cricket Career

What Does Sachin Tendulkar Backed Azad Engineering Do?

The company is seen as a small play on the energy and A&D components industry, making high-precision rotating and stationary 3D airfoils/ blades, and special parts. The company derives about 90% of its revenue from exports.

"The company is a preferred manufacturer of mission & life-critical components serving highly regulated industries with significant entry barriers. It supplies to OEMs with high global market penetration and has long-standing and deep customer relationships," SBI Securities said, as per the report.

How Has The Company Performed Financially?

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In FY 2023, the company's revenue from operations rose 31% year-on-year to Rs 261 crore, while net profit for the same period fell 71% to Rs 8.4 crore. The revenue of the company reportedly grew at a CAGR of 43% between FY21 and FY23 and PAT margin grew at a CAGR of 49% in the same period.

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