Dhara Rail Projects IPO: GMP, Subscription Status & Details

Introduction to Dhara Rail Projects IPO

Dhara Rail Projects Limited, an ISO 9001:2015 certified railway engineering services company, has launched its Initial Public Offering (IPO). The company aims to raise ₹50.20 crore through a fresh issue of 39,84,000 equity shares. The IPO is a book-built issue and will be listed on the NSE SME platform. The subscription window for the public issue opened on December 23, 2025, and is scheduled to close on December 26, 2025. This offering provides an opportunity for investors to participate in a company deeply integrated with the Indian Railways ecosystem, focusing on maintenance, repair, and specialised electrical services for rolling stock.

Company Overview

Incorporated in 2010, Dhara Rail Projects has established itself as a key service provider for Indian Railways. The company's core operations include executing annual maintenance contracts (AMCs), repair services, and the supply, installation, testing, and commissioning (SITC) of electrical equipment for a wide range of railway rolling stock. Its services cover everything from train lighting and HVAC systems to specialised equipment on Tower Wagons and power cars. The company works directly with the Ministry of Railways through competitive tenders and also collaborates with original equipment manufacturers (OEMs). As of September 2025, Dhara Rail Projects holds a diversified pan-India order book valued at approximately ₹144.09 crore, ensuring strong revenue visibility.

IPO Offer Details

The IPO is structured as a fresh issue with no Offer for Sale (OFS) component. The price band has been fixed at ₹120 to ₹126 per equity share, with a face value of ₹10 per share. The book running lead manager for the issue is Hem Securities Ltd, and the registrar is Bigshare Services Pvt Ltd.

IPO Timeline

Investors should be aware of the key dates associated with the IPO process to track allotment and listing.

Investment and Lot Size

The IPO requires investors to bid in lots, with each lot comprising 1,000 shares. The minimum investment for retail investors is for two lots, amounting to ₹2,52,000 at the upper end of the price band.

Objectives of the IPO

The net proceeds from the fresh issue will be utilized by the company for specific strategic purposes. A significant portion is allocated for strengthening its operational capabilities and balance sheet. The primary objectives are:

• Debt Repayment: ₹7.00 crore will be used for the repayment or prepayment of certain borrowings.
• Working Capital: ₹28.00 crore is earmarked to meet the company's growing working capital requirements.
• General Corporate Purposes: The remaining funds will be used for general corporate needs, providing flexibility for future growth initiatives.

Financial Performance

Dhara Rail Projects has demonstrated strong financial growth over the past few years. The company's revenue and profitability have shown a consistent upward trend, reflecting its solid execution capabilities and growing order book. For the fiscal year 2025, revenue grew by 40% and Profit After Tax (PAT) surged by 120% compared to the previous fiscal year.

IPO Subscription Status

The IPO has received a robust response from investors across all categories, indicating strong market interest. By the final day of bidding, the issue was subscribed over 28 times. The Non-Institutional Investors (NII) category saw the highest demand, followed by Qualified Institutional Buyers (QIBs) and Retail Individual Investors (RIIs).

• Overall Subscription: 28.00 times
• Qualified Institutional Buyers (QIB): 20.33 times
• Non-Institutional Investors (NII): 48.92 times
• Retail Individual Investors (RII): 23.41 times

Grey Market Premium (GMP) Analysis

The Grey Market Premium (GMP) for Dhara Rail Projects IPO has shown a positive trend, suggesting a potential listing gain. The GMP, which is an unofficial indicator of market sentiment, started at zero but climbed steadily as the IPO opening date approached. On the final day of bidding, the GMP was reported to be around ₹17 per share, implying a premium of approximately 13.5% over the upper price band of ₹126. This positive sentiment in the grey market reflects investor confidence in the company's prospects.

Strengths and Risks

Strengths:

• Strong Order Book: A diversified order book of around ₹144 crore provides clear revenue visibility.
• Pan-India Presence: Operations across multiple geographies reduce dependency on any single region.
• Established Relationship: Long-standing association with the Ministry of Railways ensures a steady stream of projects.
• Experienced Management: The promoters have extensive experience in the railway projects sector.

Risks:

• High Dependency: Heavy reliance on contracts from Indian Railways poses a concentration risk.
• Labor-Intensive Operations: The business is dependent on a large workforce, making it susceptible to labor-related disruptions.
• Supplier Concentration: Dependence on a limited number of suppliers could affect service delivery.

Conclusion

The Dhara Rail Projects IPO has garnered significant investor attention, driven by its strong financial track record, robust order book, and specialized business model within the Indian Railways sector. The overwhelming subscription figures and positive Grey Market Premium point towards a potentially strong market debut. The company's plan to utilize the IPO proceeds for debt reduction and working capital is expected to further strengthen its financial position. The shares are scheduled to be listed on the NSE SME platform on December 31, 2025.