GNG Electronics Ltd, the electronics manufacturing services (EMS) player, witnessed a stellar response on Day 1 of its initial public offering (IPO), with the issue being subscribed 9.2 times overall, driven by overwhelming interest from retail and non-institutional investors (NIIs). The IPO, which opened for subscription on July 22, 2025, has garnered significant market attention, reflecting the continued investor appetite for niche EMS sector offerings amid India’s manufacturing boom.
IPO Subscription Details – Day 1
The ₹420 crore public issue saw its retail portion being oversubscribed 12.5 times, while the NII segment attracted bids 10.3 times the reserved portion. Qualified Institutional Buyers (QIBs) are expected to intensify participation on the final day as per standard bidding patterns.
| Investor Category | Subscription (times) |
|---|---|
| Qualified Institutional Buyers (QIBs) | 2.1 |
| Non-Institutional Investors (NIIs) | 10.3 |
| Retail Individual Investors (RIIs) | 12.5 |
| Total Overall | 9.2 |
IPO Details
| Particulars | Details |
|---|---|
| Issue Size | ₹420 crore |
| Price Band | ₹250 – ₹265 per share |
| Lot Size | 55 shares |
| Fresh Issue | ₹300 crore |
| Offer for Sale (OFS) | ₹120 crore |
| IPO Opening Date | July 22, 2025 |
| IPO Closing Date | July 25, 2025 |
| Listing | NSE, BSE |
Objectives Of The IPO
GNG Electronics aims to utilise the proceeds from its fresh issue for:
- Capacity Expansion: Setting up a new manufacturing unit in Greater Noida for LED drivers, smart meters, and IoT devices.
- Debt Reduction: Repayment of term loans to strengthen the balance sheet.
- R&D Investment: Enhancing research capabilities for smart energy management solutions.
- General Corporate Purposes: Working capital and operational scaling.
About GNG Electronics
Founded in 2004, GNG Electronics is an emerging EMS player specialising in:
- LED drivers and smart lighting solutions
- IoT-based smart meters and energy management devices
- PCB assembly for consumer electronics and industrial applications
With three manufacturing facilities across Noida and Manesar, the company serves key clients in the energy, utilities, and industrial automation sectors.
Financial Performance Snapshot
| Particulars (₹ crore) | FY23 | FY24 | YoY Growth (%) |
|---|---|---|---|
| Revenue | 520 | 715 | +37.5 |
| EBITDA | 64 | 89 | +39.1 |
| EBITDA Margin (%) | 12.3 | 12.4 | +10 bps |
| Net Profit | 34 | 47 | +38.2 |
| Net Profit Margin (%) | 6.5 | 6.6 | +10 bps |
| ROE (%) | 18.5 | 20.1 | +160 bps |
Strengths Driving IPO Demand
- EMS Industry Tailwinds: Growing domestic manufacturing and ‘China plus one’ strategy benefits.
- Strong Client Base: Includes leading smart lighting brands, power utilities, and OEMs.
- Capacity Expansion: Planned new unit to double capacity over two years.
- Healthy Financials: Robust revenue growth, stable margins, and efficient working capital management.
Industry Outlook
India’s EMS sector is projected to grow at a CAGR of 27% from FY24 to FY30, driven by localisation, Make in India policies, and rising electronics consumption across consumer, automotive, industrial, and smart energy segments.
| Metric | FY24 | FY30E | CAGR (%) |
|---|---|---|---|
| EMS Market Size (₹ crore) | 2,10,000 | 8,50,000 | +27.0 |
Grey Market Premium (GMP)
Market watchers report that GNG Electronics’ shares are commanding a GMP of ₹58-60 per share, indicating a likely premium listing of 22-24% over the issue price, subject to market sentiment on listing day.
Peers Comparison
| Company | FY24 Revenue (₹ crore) | EBITDA Margin (%) | Net Profit Margin (%) | ROE (%) | P/E (x) |
|---|---|---|---|---|---|
| GNG Electronics | 715 | 12.4 | 6.6 | 20.1 | 32.5 (IPO) |
| Dixon Tech | 17,560 | 4.9 | 2.4 | 25.5 | 69.4 |
| Amber Enterprises | 5,350 | 6.2 | 3.0 | 14.2 | 47.6 |
| Syrma SGS | 2,540 | 10.4 | 5.6 | 16.3 | 40.2 |
GNG’s profitability ratios are relatively strong compared to listed EMS peers, justifying investor enthusiasm.
Management Commentary
Rajeev Goel, Chairman & Managing Director of GNG Electronics, stated:
“The strong Day 1 response underscores investor trust in our growth strategy. The IPO will empower us to expand capacities, strengthen R&D, and build a future-ready organisation catering to the rapidly evolving smart electronics market.”
Potential Risks
While prospects remain robust, key risks include:
- Client concentration with top five customers accounting for ~65% revenue
- Global electronics supply chain volatility impacting components availability
- Currency fluctuations as raw materials are partly imported
Market Reaction
Ahead of the IPO, unlisted shares of GNG Electronics have seen heightened trading volumes in the grey market, reflecting bullish sentiment towards EMS companies benefitting from policy tailwinds and robust domestic demand.
Future Strategy
Post IPO, GNG Electronics aims to:
- Expand smart meter and IoT solutions for smart city projects
- Enter automotive electronics assembly to diversify revenue streams
- Strengthen design capabilities to offer integrated ODM-EMS solutions
- Explore strategic tie-ups with global players for technology transfer
Analyst Views
Market experts tracking the IPO stated:
“GNG Electronics is well positioned within the sunrise EMS sector. The issue is attractively priced relative to peers with robust financials, strong growth trajectory, and capacity expansion plans. Near-term volatility notwithstanding, it offers long-term value.”
Conclusion
The strong Day 1 subscription of 9.2 times for GNG Electronics’ ₹420 crore IPO, driven by retail and NII participation, highlights robust market confidence in India’s EMS growth story. As the company looks to scale capacities and strengthen its smart electronics portfolio, investors await the final subscription figures and listing gains later this month.
Disclaimer
This news content is for informational purposes only. It is not intended as investment advice. Readers are advised to consult financial experts before making any business or investment decisions based on this report.
