Tempsens Instruments IPO opens: Should you subscribe? What GMP signals

The initial public offering (IPO) of Rajasthan-based Tempsens Instruments (India), a manufacturer of contact and non-contact temperature sensors, opened for subscription on Thursday, August 20. The issue will close on August 24.

Ahead of the IPO, the company raised Rs 194.5 crore from anchor investors on August 19. Tempsens Instruments allotted 64.84 lakh equity shares to 29 anchor investors, including Aranda Investments, owned by Singapore's Temasek Holdings, Goldman Sachs and Prashant Khemka's Ashoka WhiteOak ICAV - Ashoka WhiteOak Emerging Markets Equity Fund.

The company has fixed the IPO price band at Rs 285-300 per share and aims to raise around Rs 650 crore. At the upper end of the price band, retail investors will need to invest a minimum of Rs 15,000, with the minimum bid lot set at 50 shares.

Tempsens Instruments IPO GMP

Tempsens Instruments has attracted interest in the grey market ahead of its issue. At the latest available level, the IPO's grey market premium (GMP) stood at 73.33 per cent.

The IPO comprises a fresh issue of Rs 95 crore and an offer for sale (OFS) of 1.85 crore shares worth Rs 555 crore by existing shareholders, including Amit Talesara, Puneet Talesara and Chandra Prakash Talesara.

Of the fresh issue proceeds, Rs 18 crore is earmarked for capital expenditure related to electrical heating solutions and specialised cable solutions. Another Rs 55 crore will be used for prepayment or scheduled repayment of outstanding borrowings, while the balance will be utilised for general corporate purposes.

Brokerages' view

SBI Securities: Subscribe

SBI Securities has recommended subscribing to the IPO at the cut-off price. The brokerage cited the company's presence across temperature sensing solutions, electrical heating solutions and specialised cables as key factors behind its recommendation.

Geojit: Subscribe

Geojit has also assigned a 'Subscribe' rating to the IPO for medium- to long-term investors.

The IPO's GMP reflects activity in the unofficial grey market and is not a regulated indicator of the company's listing price or future performance.