DCX Systems lists at 38% premium, in line with grey market expectations

DCX Systems lists at 38% premium, in line with grey market expectations
  • Shares of DCX Systems listed at ₹286.25 against the allotment price of ₹207 per share.
  • The market capitalisation of the company stood at ₹2,768 crore.
  • The IPO was subscribed 69.79 times amidst erratic market conditions.
Bengaluru-based DCX Systems, a manufacturer of electronic sub-systems and cable harnesses, listed at ₹286.25 on the bourses on Friday.

It listed at a 38.3% premium over its allotment price of ₹207 per share. The benchmark indices opened higher today, on positive global cues.

The listing gains of ₹79 per share is in line with the expectations of the grey market, where premiums were fixed at ₹85. GMP is the premium at which IPO shares are traded in an unofficial market before they are listed on the stock exchanges.

The market capitalisation of the company stands at ₹2,768 crore, according to BSE data.

In spite of the fact that secondary markets have been erratic in the last few weeks, analysts recommended investors to subscribe to DCX Systems for listing gains.


“DCX, being preferred IOP in the defence & aerospace space is well placed to capture the industry tailwinds. We like its focus on revenue/geography diversification, customer base expansion and inorganic growth which could keep the earnings growth strong. It is valued at 30.5xFY22 P/E which is reasonable compared to listed peers. Given the fancy for defence stocks and continuous news flows in that space, we expect the IPO to do well. We suggest investors to ‘Subscribe’ for listing gains,” said analysts at Motilal Oswal.

The IPO was subscribed a whopping 69.79 times amidst volatile market conditions. Qualified institutional investors’ subscription was 84.32 times the IPO offer, while the retail portion of the IPO saw a subscription of 61.77 times the offer.

The company said that the IPO proceeds will be utilised towards debt repayment, funding working capital, investment in its subsidiary and general corporate purposes.

The company is primarily engaged in system integration and manufacturing a comprehensive array of cables and wire harness assemblies; and kitting.

It has a manufacturing facility located at the Hi-Tech Defence and Aerospace Park SEZ in Bengaluru.

DCX Systems’ revenues increased three times in the last three fiscal years and profitability has gone up several times during the period. A significant portion of the company’s revenues are in US dollars via exports.
Particulars Total income Profit
FY21₹983 crore ₹29.5 crore
FY20₹465 crore ₹9.7 crore
FY19₹309 crore ₹4.5 crore

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