One of the market leaders in the precious engineering segment of India, Harsha Engineers International, has decided to refile its draft papers with the capital market regulator to initiate an IPO of Rs. 755 crores. Currently, the promoters of Harsha Engineers International hold 99.7% equity of the company.
This public issue will include an offer for sale from its promoters will worth Rs. 300 crores. Along with that, the fresh issue equity portion of this IPO will be worth Rs. 455 crores. This IPO will also include a portion for the employees that will be available at a discounted price. Besides, the company has plans to raise about Rs. 90 crores in its pre-IPO round, which will be then deducted from the fresh issue size of this initial public offer.
Harsha Engineers International aims to use the funds accumulated from this public issue to finance –
Repayment of existing debts of about Rs. 270 crores
Buy necessary machinery of around Rs. 77.95 crores
Invest about Rs. 7.11 crores in repair and renovate the current infrastructure that includes production facilities and offices
Lastly, meeting its general corporate purpose
The other particulars of this IPO, i.e. timeline, price band, etc., are not available yet.
About Harsha Engineers International
This Ahmedabad-based precision bearing cage manufacturer is the largest one in India in terms of revenue in the organised sector. It offers a wide variety of precision engineering products in segments like automobile, aviation, aerospace, mining, construction, railways, agriculture, renewable energy, and various other industrial sectors.
The company has five manufacturing units located in India, Romania and China. The primary manufacturing units of Harsha Engineers International are at Moraiya and Changodar in Gujarat. The other facilities in Changshu in China and Ghimbav Brasov in Romania are operated through a subsidiary model.
According to Harsha Engineers International, they have 50% market share in this segment in India and 5.2% in the international market in CY2020.
Moving ahead to its financials, Harsha Engineers International recorded a profit of Rs. 45.44 crores in FY2021. The revenue of this fiscal year was Rs. 873.75 crores. Moreover, in the following six months, i.e. till September 2021, the profit stood at Rs. 43.7 crores against revenue of Rs. 629.46 crores.
To sum up, India’s bearing manufacturing market size was $1772.6 million in 2021, and it is projected to grow to $3374.4 million by 2027. Hence, the growth rate here is at a CAGR of 10.9% during 2020-27. Taking this market size into account, one can easily estimate the opportunities that this segment holds in the coming decade. Hence, the public issue of Harsha Engineers International will be one to look for.
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Frequently Asked Questions
When was the first time Harsha Engineers International filed its DRHP?
Harsha Engineers International initially filed its DRHP with SEBI in 2018.
Who are the promoters of Harsha Engineers International?
The promoters of Harsha Engineers International are Rajendra Shah, Nirmala Shah, Pilak Shah, Harish Rangwala, and Charusheela Rangwala.
What is the face value of Harsha Engineers International’ shares?
The face value of Harsha Engineers International’s shares is not available yet.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.