The Vikran Engineering IPO has seen significant investor interest, with the issue being oversubscribed on its second day. The IPO, which opened on August 26, 2025, and closes on August 29, 2025, aims to raise ₹772 crore.

Subscription Status

By the end of Day 1, the IPO was subscribed 2.51 times. The retail portion was booked 2.44 times, the Qualified Institutional Buyers (QIBs) portion 0.43 times, and the Non-Institutional Investors (NII) portion a remarkable 5.43 times. As of Day 2, the IPO continued to receive strong interest. Preliminary reports suggest the issue has been oversubscribed by more than 3 times so far.

Grey Market Premium (GMP)

The Grey Market Premium (GMP) for Vikran Engineering IPO has fluctuated. On August 26, 2025, the GMP was around ₹17, suggesting a listing price of ₹114 per share based on the upper end of the price band (₹97). This indicated a potential listing gain of about 17.53%. Earlier, the GMP had reached a high of ₹25 on August 21 before settling at ₹13 on Day 1. As of August 28, the GMP is ₹13, reflecting a 13.4% gain over the issue price. It's important to remember that the GMP is an unofficial indicator and subject to market volatility.

IPO Details

Vikran Engineering's IPO consists of a fresh issue of shares worth approximately ₹721 crore and an offer-for-sale (OFS) of ₹51 crore by the promoter. The price band is set at ₹92 to ₹97 per share, with a lot size of 148 shares, requiring a minimum investment of ₹14,356 for retail investors. The company intends to use ₹541 crore from the fresh issue to meet working capital requirements, with the remaining funds allocated for general corporate purposes. The IPO's tentative listing date on the BSE and NSE is September 3, 2025.

Company Overview

Vikran Engineering Ltd, founded in 2008, is an engineering, procurement, and construction (EPC) company. The Mumbai-based firm's portfolio includes projects in underground water distribution, surface water extraction, overhead tanks, and distribution networks. The company has undertaken projects for the government and focuses on operational excellence and efficient cost structure. Vikran Engineering's revenue was ₹922.36 crore in 2025, against ₹791.44 crore in 2024. The company reported a profit of ₹77.82 crore in 2025, compared to ₹74.83 crore in 2024.

Financial Performance and Valuation

Vikran Engineering has demonstrated strong financial growth in recent years. Revenue rose from ₹524 crore in FY23 to ₹916 crore in FY25, a CAGR of 32%. Profit after tax grew at a 35% CAGR over the same period, from ₹43 crore in FY23 to ₹78 crore in FY25. At the upper end of the price band (₹97), the issue is valued at 22x FY25 earnings and 4x book value.

Concerns

Despite positive indicators, potential investors should consider certain risks. These include stretched working capital cycles and a past ban from railway electrification projects by the Railways' vigilance wing, which could impact order flows.

Analyst Recommendations

Brokerage firm Canara Bank Securities has given a 'subscribe' tag, noting that the issue is fairly priced compared to its listed peers. They also highlighted the company's rapid growth in order execution and experienced promoters. However, they cautioned about the ban by the Executive Director of Gati Shakti and stretched working capital. Reliance Securities also recommends subscribing, citing Vikran Engineering's strong execution track record, alignment with government infrastructure push, and asset-light business model.