Pace Digitek IPO

Pace Digitek Ltd is into the business of providing critical support solutions to the telecom, energy, and the ICE industries. For the telecom sector; it offers passive manufacture of equipment, O&M services, AMC contracts, erection of telecom towers etc. For the energy sector; it offers BOO models for solar projects and manufacture of lithium-ion batteries. For the ICE sector; it offers smart kiosks, surveillance systems and smart classrooms. It has 2 manufacturing facilities in Bengaluru for telecom equipment and lithium-ion batteries. 

The IPO is entirely a fresh issue of shares with no offer for sale (OFS) component. Fresh funds will be used for funding its proposed capital expenditure to the tune of nearly ₹630 crore. Pace Digitek Ltd was promoted by Maddisetty Venugopal Rao, Padma Maddisetty, Rajiv Maddisetty, and Lahari Maddisetty. The IPO will be lead-managed by Unistone Capital Private Ltd; while MUFG Intime India Private Ltd will be the registrar. The company is headquartered at Bengaluru, in the state of Karnataka. 

Highlights of the IPO Issue

Here are the key highlights of the public issue of Pace Digitek Ltd. 

1. The IPO of will be open from September 26th, 2025 to September 30th, 2025. It has a face value of ₹2 per share and IPO price band is set in range of ₹208 to ₹219 per share.
2. The IPO of Pace Digitek Ltd will be entirely a fresh issue of shares, with no offer for sale (OFS) component to it.
3. The fresh issue portion comprises the issue of 3,74,04,018 shares (374.04 lakh shares), which at the upper price band of ₹219 per share translates into ₹819.15 crore.
4. Since there is no OFS component, the overall IPO will also comprise of the fresh issue of 3,74,04,018 shares (374.04 lakh shares) worth ₹819.15 crore at the upper band price of ₹219 per share. 

The IPO of Pace Digitek Ltd will be listed on the NSE and the BSE on the IPO mainboard. 

Key Dates, Investor Allocation, And Lot Sizes

Here are the key dates pertaining to the IPO of Pace Digitek Ltd 

Data Source: Company RHP 

Investors can apply either through their existing trading account or the ASBA application can be directly logged through the internet banking account. This can only be done through the authorized list of self-certified syndicate banks (SCSB).  

The table below captures the gist of the allocation to various categories. 

Data Source: Security Parameters Filing (NSE) 

The anchor portion, is carved out of the QIB portion and the QIB portion available in the IPO offer has been reduced proportionately. Please note that the above shares are final and may differ marginally from the original announcement. Here is a quick look at the lot sizes applicable for the IPO of Pace Digitek Ltd for various categories of investors. 

It may be noted here that for the B-HNI category and for the QIB (qualified institutional buyer) category, there are no upper limits applicable. (1 Lot = 68 shares) 

Financial Highlights

The table captures the key financials of Pace Digitek Ltd for last 3 financial years.  

Data Source: Company RHP filed with SEBI (FY refers to Apr-Mar period) 

Over the last 3 years, the company saw a 4-fold jump in sales in FY24, and hence the previous period data from that point is not really comparable. PAT margins are stable around 11%, but the ROE has been fairly erratic over the last 3 years. 

Valuation Metrics

At the current issue price of ₹219 per share, the valuation of the company is at a P/E ratio of 13.4X in terms of latest year EPS of ₹16.30. While that may look like reasonable valuation, what investors must closely look at is the trade receivables of the company which is around 70% of the assets on its balance sheet. That shows a huge liquidity pressure on the business. Such huge receivables have also depressed the ROA and the asset turnover. 

The company does bring some distinct advantages to the table. The company offers end-to-end solutions to the telecom sector from contract manufacturing to after sales servicing. This allows them to get a larger wallet share. The company also has a strong order book in terms of manufacturing and service orders. However, investors really need to understand the reason for such a substantial receivable in the balance sheet before investing! 

A Brief on the Anchor Allocation

The anchor issue of Pace Digitek Ltd saw a relatively strong response on 25th September 2025 with 28.85% of the IPO size absorbed by anchors. Out of 3,88,00,362 shares (388.00 lakh shares) on offer, anchors picked up 1,11,93,807 shares (111.94 lakh shares) accounting for 28.85% of the total IPO size. The entire anchor allocation was made at the upper end of the price band of ₹219 per share. This includes the face value of ₹2 per share plus a share premium of ₹217 per share. The anchor bidding process opened and closed on 25th September 2025.  

Key Points to Note in the Anchor Allocation Process

Here are the key details pertaining to the anchor bidding of Pace Digitek Ltd 

An anchor investor in an IPO is a qualified institutional buyer (QIB) like a foreign portfolio investor or mutual fund or insurance company or a sovereign fund which invests before the IPO is made available to the public as per SEBI regulations. It helps in price discovery. 

Anchor Allocation Investors

On 25th September 2025, Pace Digitek Ltd allotted 1,11,93,807 shares to 16 anchor investors. The allocation was done at the upper IPO price band of ₹219 per share which resulted in overall anchor allocation of ₹245.14 crore. The anchors have already absorbed 28.85% of the total issue size of ₹849.73 crore. Listed below are the Top 10 IPO anchor investors who accounted for anchor collection of ₹205.14 crores, or, 83.68% of the overall anchor allocation. 

Data Source: BSE Filings (Value Allocated in ₹ in Crore) 

The detailed and comprehensive report on the anchor allocation with the mutual fund portion separated can be accessed on BSE by clicking on the link below. 

https://www.bseindia.com/markets/MarketInfo/DownloadAttach.aspx?id=20250925-53&attachedId=59d71791-c0f9-430f-ae0c-e9a828d035ba 

Out of the 1,11,93,807 shares allocated to the anchors in the IPO, there were a total of 18,26,616 shares allocated to mutual funds registered with SEBI. The allocation was made to 3 mutual fund schemes across 2 AMCs. Mutual funds accounted for 16.32% of the total anchor allocation of the IPO. Most of the other anchor shares were allocated to alternative investment funds (AIFs), FPIs and ODIs. 

Next Step in the IPO

Post the closure of the IPO subscription on 30th September 2025, the basis of allotment will be finalized on 01st October 2025 and the refunds will be initiated on 03rd October 2025. In addition, the demat credits are expected to also happen on 03rd October 2025 and the stock will list on 06th October 2025 on the NSE and the BSE. The credits to the demat account to the extent of shares allotted will happen by the close of 03rd October 2025 under ISIN (INE0S3G01027). 

IPO Subscription Status On Day-1

As of 5.10 pm on 26th September 2025, out of the 276.07 lakh shares on offer in the IPO (excluding anchor portion), Pace Digitek Ltd saw bids for 44.69 lakh shares. This implies an overall subscription of 0.16X at a macro level. The granular break-up of subscriptions as of the close of Day-1 of the IPO of Pace Digitek Ltd was as under: 

The subscriptions were led by the Retail Investors followed by the QIB investors and the HNI / NII investors in that order. QIB bids and NII bids typically gather most of the momentum on the last day, and that would be the case in this issue also. Both the QIB and the NII bids pick up momentum on the last day since that is when the bulk HNI funding bids, corporate bids, and the bulk QIB bids come in. Here is the category-wise subscription. The overall subscription ratio excludes anchor portion. 

Data Source: NSE / BSE (as of close of Day-1 of the IPO) 

The IPO is open up to September 30, 2025, at which point we will know the final subscription status of the IPO. 

Modest Listing For Pace Digitek Ltd

Pace Digitek Ltd had a modest listing on 06th October 2025. On the NSE, the stock of Pace Digitek Ltd listed at ₹225, a modest premium of 2.74% to the IPO issue price of ₹219 per share. The issue was subscribed just 1.59 times overall at the close of the IPO, so opening sentiments being modest was along expected lines. However, had the market sentiments been stronger, the post listing performance could have been better. 

On the BSE also, the listing of Pace Digitek Ltd was at a modest premium. Against the issue price of ₹219 per share, the stock listed at ₹226.85, a premium of 3.58% to the issue price. The stock of Pace Digitek Ltd is on T+1 rolling settlement system. 

How The Stock of Pace Digitek Ltd Moved During the Day?

After opening modestly higher at ₹225 per share on the NSE, the stock traded below the listing price for a better part of the trading day. During the day, the stock of Pace Digitek Ltd touched a high of ₹231 and an intraday low of ₹207. On the NSE, the upper circuit band of the stock is set at ₹270 while the lower circuit band is set at ₹180 per share. Effectively, the stock remained below the listing price for a better part of the day. 

What about the BSE? After opening modestly higher at ₹226.85 per share on the BSE, the stock hovered below the listing price for better part of the trading day. During the day, the stock of Pace Digitek Ltd touched a high of ₹231 and an intraday low of ₹206.90. On the BSE, the upper circuit band of the stock is set at ₹272.20 while the lower circuit band is set at ₹181.50 per share. Even on BSE, the stock remained below listing price for most of the day. 

How Did the Stock of Pace Digitek Ltd Close on Listing Day?

Here is how the stock of Pace Digitek Ltd closed on the NSE. The closing price of ₹216 per share is at a discount of -1.37% to the IPO issue price and at a discount of -4.00% to the listing price of ₹225 per share on the NSE. The company had a market cap of ₹4,662 crore at close. During the day, the stock of Pace Digitek Ltd traded 360.40 lakh shares on the NSE, with total traded value of ₹801.70 crore. Deliveries were 46.84% of total volumes on NSE. 

Here is how the stock of Pace Digitek Ltd closed on the BSE. The closing price of ₹217.50 per share is at a discount of -0.68% to the IPO issue price and a discount of -4.12% to the listing price of ͭ₹226.85 on the BSE. The company had a market cap of ₹4,695 crore as of close. During the day, the stock of Pace Digitek Ltd traded 34.12 lakh shares on the BSE, having a total traded value of ₹76.36 crore. Deliveries were 48.64% on the BSE. 

The stock trades under the codes: NSE (PACEDIGITK), BSE (544550), ISIN (INE0S3G01027).