Oswal Pumps files IPO papers with SEBI, to raise Rs 1,000 crore via fresh issue

Oswal Pumps, a company situated in Haryana approached SEBI recently, to raise Rs.1000 crores through an Initial Public Offering(IPO) based on their draft red herring prospectus(DRHP) which they have filed. This IPO will include a fresh issue of equity shares worth Rs.1000 crore and an Offer for Sale(OFS) of about 1.13 crore shares held by the promoter Health Vivek Gupta.

Utilization of Funds

The fresh issue proceeds will be utilized in the areas mentioned and several others. The bulk of the Capital Expenditure will be deployed to support the operational capacity of the company and diversification of the product portfolio. Further, Oswal Pumps intends to set up additional manufacturing plants in Haryana’s Karnal district. Some of the proceeds will be used for repayment of loans that will boost the business’ standing with lenders while some will do general corporate business activities.

Business Model & Position

Oswal Pumps manufactures solar and grid-connected as well as submersible and monoblock pumps that come together with electric motors in the brand ” Oswal ”. The organization had installed more than 26,270 solar pump sets under the PM Kusum Scheme in turnkey mode across states like Haryana, Rajasthan, Uttar Pradesh & Maharashtra. Oswal Pumps competes with the large players in the sector like the Kirloskar brothers, Shakti-Pumps, WPIL, KSB, and Roto Pumps in the competitive markets.

Financial Performance

Oswal Pumps has demonstrated good financial growth. For FY24, the company’s profit surged by 186% to Rs.97.7 crore. Revenue increased by 97% to Rs.758.6 crore, and EBITDA rose by 160% to Rs.150.1 crore, with margins expanding by 480 basis points to 19.8%.

Conclusion: With a business model in place, financial metrics, and expansion plans, Oswal Pumps seems well-positioned for growth in the renewable energy sector. The upcoming IPO provides a compelling opportunity for investors interested in sustainable technology and aligns with broader environmental goals. As the company prepares to enter the public market, what unfolds will be exciting to see.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.