Dhoot Transmission IPO Set for High-Octane Listing as Grey Market Signals 30% Premium

Dhoot Transmission IPO Set for High-Octane Listing as Grey Market Signals 30% Premium​

The Rs 3,066.89-crore Dhoot Transmission Initial Public Offering (IPO) is continuing to attract significant investor interest on its second day of bidding. The issue is currently commanding a substantial premium in the grey market, pointing towards potentially explosive listing gains for subscribers. This strong momentum comes as analysts maintain generally positive outlooks, advising investors to carefully consider subscribing.

IPO Demand and Subscription Metrics​

The Dhoot Transmission IPO garnered a solid response on Day 1 of the bidding process. The issue was subscribed at 63% overall against the offer of 2.49 crore shares. Individual Retail Investors (RIIs) showed particular strength, with their portion being subscribed 74%.

Non-Institutional Investors (NIIs) also demonstrated robust demand, achieving a subscription rate of 1.09 times against the 53.92 lakh shares offered to that segment. In contrast, the Qualified Institutional Buyers (QIBs) category saw a lower response, registering 6% against its allocation of 68.99 lakh shares.

Grey Market Momentum and Listing Outlook​

The IPO's Grey Market Premium (GMP) is currently standing at Rs 259. This indicates a potential 30% premium over the upper end of the IPO price band, which is set between Rs 829-Rs 871 per share. Based on this current GMP, the stock could potentially list around Rs 1,130 per share.

It is crucial, however, to note that the grey market indicator remains unofficial and subject to volatility. The GMP should not be regarded as a guarantee of the stock's actual listing price or its subsequent post-listing performance.

Financial Performance Highlights in FY26​

Dhoot Transmission reported a robust financial trajectory during the fiscal year 2026, driven by steady earnings growth and increased revenue. Total income saw a significant increase of 31%, reaching Rs 4,563.70 crore from Rs 3,472.24 crore in FY25.

Profit After Tax (PAT) also reflected sustained business momentum, rising 12% to Rs 396.84 crore compared to the previous year’s PAT of Rs 353.89 crore. This financial health provides a strong foundation for the company's continued expansion and market leadership.

Strategic Use of IPO Proceeds​

The funds raised through this public issue are earmarked for critical corporate strengthening and future growth initiatives. A major focus is dedicated to debt reduction, with nearly Rs 464.80 crore planned for repaying outstanding borrowings. Another considerable sum, around Rs 301.77 crore, will be infused into subsidiaries like Dhoot Autocomponents Private Limited and Dhoot Transmission UK Limited to help them reduce their existing debt obligations.

The company has also committed Rs 150 crore towards establishing new wiring harness manufacturing facilities in Jhajjar, Haryana, and Shoolagiri, Hosur, Tamil Nadu, enhancing its production capacity significantly.

Expert Viewpoints on Growth Trajectory​

Both industry experts and research analysts have recommended subscribing to the issue for long-term growth potential. AnandRathi assigns a "Subscribe for Long Term" rating, noting that despite concerns regarding customer concentration and execution risks, the company's market leadership in E&E solutions provides a favourable outlook.

Ventura Securities also recommends subscribers, highlighting Dhoot Transmission's strong FY26 performance and its expanding EV contribution. The brokerage emphasizes the company’s strategic pivot toward premiumisation and electrification, noting that services like battery packs and ADAS represent future growth avenues.

Company Profile and Automotive Edge​

Founded in April 1998, Dhoot Transmission Ltd. stands as a prominent electrical and electronics (E&E) provider across automotive and industrial sectors. The company’s diversified product range includes wiring harnesses, sensors, and battery packs, serving both ICE and EV platforms globally.

Dhoot Transmission holds a dominant position in the two-wheeler and three-wheeler wiring harness market, commanding a 41% share of that space. Furthermore, it dictates nearly 70% of the electric two-wheeler and three-wheeler segment. Crucially, about 95% of its automotive product portfolio is either EV-focused or powertrain neutral, ensuring long-term benefit from vehicle electrification trends.