Sachin Tendulkar's investment in Azad Engineering surges sixfold following IPO

As Azad Engineering made its foray into the stock exchanges on December 28, Tendulkar's investment in the company increased sixfold.

Khushboo Joshi
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Cricket legend Sachin Tendulkar's investment in Azad Engineering has seen a remarkable surge, thanks to the aerospace components and turbines manufacturer's stellar debut on the stock market. As Azad Engineering made its foray into the stock exchanges on December 28, Tendulkar's investment in the company increased sixfold.

Tendulkar holds approximately 4.3 lakh shares in Azad Engineering, acquired at an adjusted average cost of ₹114.10 each in March, totalling an investment of around ₹4.9 crore. However, with the stock's debut at ₹720, his total investment now stands at about ₹30.96 crore. This substantial increase in valuation highlights the success of Azad Engineering's initial public offering (IPO) and the favourable market response.

Other notable investors

Besides Tendulkar, other sports stars have also witnessed significant gains from their investments in Azad Engineering. Badminton players Saina Nehwal and PV Sindhu, along with former cricketer VVS Laxman, have seen their investments triple. Each of them holds 44,000 shares with an adjusted acquisition price of ₹228.17, resulting in a total investment of around ₹1 crore each. These gains are particularly noteworthy as none of these sports icons participated as selling shareholders in the IPO.

Azad Engineering: Business overview

Established in 1983, Azad Engineering specialises in manufacturing aerospace components and turbines. The company caters to original equipment manufacturers (OEMs) in sectors such as aerospace, defense, energy, and oil and gas. With a clientele that includes industry giants like General Electric, Honeywell International, Mitsubishi Heavy Industries, Siemens Energy, Eaton Aerospace, and MAN Energy Solutions, Azad Engineering has established itself as a key player in the market.

Analyst outlook and IPO success

Analysts express optimism about Azad Engineering's future, citing factors such as long-term contracts, a stable customer base, and robust revenue visibility. The company's IPO witnessed significant demand, with a subscription rate of 80.6 times. Qualified institutional buyers led the way, subscribing to 179.66 times the allotted quota, followed by high-net-worth individuals (87.55 times) and retail investors (23.71 times).
Comparing Azad Engineering with peers in the capital goods sector, analysts note the company's superior growth, comparable return ratios, and a valuation in line with its peer group.

Utilisation of IPO proceeds

Azad Engineering plans to allocate ₹60.4 crore from the IPO proceeds for acquiring plant and machinery. Additionally, the company intends to repay debts amounting to ₹138.19 crore, with borrowings standing at ₹154.2 crore as of September 2023. The remaining funds will be utilised for general corporate purposes.