* Shares open above IPO price of 64 Swiss francs

* Institutional investors among main buyers

(Adds bullets market reaction, detail)

ZURICH, May 7 (Reuters) - Shares in Swiss engineering firm SFS SFSN.S rose above their offer price when they debuted on the Swiss SIX exchange on Wednesday, adding to a growing feel-good factor in the domestic stock market.

The firm, which makes miniature screws for smartphones and tablets, priced its initial public offering (IPO) at 64 Swiss francs per share earlier on Wednesday, giving the company a market value of 2.4 billion Swiss francs ($2.75 billion).

Shares had risen more than 5 percent to 67.55 Swiss francs by 1107 GMT.

Traders said that institutional investors were among the main buyers and that investors were attracted to the group's outlook.

"Long term, we are convinced by the business model," one trader said. "The business is very solid."

SFS plans to use the proceeds to help it expand, as well as for acquisitions and general business.

SFS placed just over 10 million shares, or 26.7 percent of its share capital, in the IPO. Of this, just over half were new shares sold by the company. The rest were existing shares sold by its founding family.

The family also has an overallotment option of up to 992,420 shares, which would increase the free float to 34.2 percent if fully exercised.

The size of the SFS IPO was 641 million Swiss francs. It follows Swiss listings last month by online travel firm Bravofly Rumbo Group BRGF.S worth 256 million francs and lender Thurgauer Kantonalbank TKBP.S , which raised 160 million francs. ($1 = 0.8734 Swiss Francs)

(Reporting by Joshua Franklin and Rupert Pretterklieber; Editing by Hugh Lawson)

((joshua.franklin@thomsonreuters.com)(+44207 542 0331)(Reuters Messaging: joshua.franklin.thomsonreuters.com@reuters.net))

Keywords: SFSHOLDING IPO/STOCKS