Gala Precision Engineering IPO: Here's All You Need To Know
The IPO consists of a fresh issue of Rs 135.34 crore and an offer-for-sale of Rs 32.59 crore. The issue opens on Sept. 2 and closes on Sept. 4
Gala Precision Engineering Ltd. plans to raise Rs 167.93 crore through an initial public offering, which is set to open on Sept. 2. The IPO consists of a fresh issue of Rs 135.34 crore and an offer-for-sale of Rs 32.59 crore.
The company has set a price band of Rs 503–529 per share with a face value of Rs 10 each for the issue. The IPO issue will close on Sept. 4. At the upper price band, the market cap of Gala Precision Engineering stands at Rs 670 crore, as per NDTV Profit calculations.
The minimum lot size for retail investors is 28 shares, requiring an investment of at least Rs 14,812.
Issue Details
Issue opens: Sept. 2
Issue closes: Sept. 4
Issue price: Rs 503-529 per share.
Total issue size: Rs 167.93 crore.
Fresh issue: Rs 135.34 crore.
Offer for sale: Rs 32.59 crore
Bid lot: 28 shares.
Listing: BSE and NSE.
Use Of Proceeds
Setting up a new facility at Vallam-Vadagal, SIPCOT, Sriperumbuddur, Tamil Nadu, for manufacturing high-tensile fasteners and hex bolts.
Funding capital expenditure requirements towards the purchase of equipment, plants, and machinery at Wada, Palghar, Maharashtra
Repayment or prepayment, in full or in part, of certain borrowings availed by the company.
Business
Incorporated in 2009, the company is a precision component manufacturer specializing in technical springs, including disc & strip springs (DSS) with wedge lock washers, coil & spiral springs (CSS), and special fastening solutions (SFS)
Their products are used in sectors like renewable energy, including wind turbines and hydropower plants; various industrial sectors such as electrical and off-highway equipment; infrastructure and general engineering; and mobility segments such as automotive and railways.
The company operates from two manufacturing facilities located in Wada, Palghar, Maharashtra.
On the international front, the company exports to over 25 countries, encompassing major markets such as Germany, Denmark, China, Italy, Brazil, the USA, Sweden, and Switzerland, which contributed 37.53% to total sales as of March 31, 2024.
Financials
IPO Rush: Gala Precision Among Six Issues This Week, Premier Energies And ECOS Mobility To List
Key Risks
The top 10 customers contribute to 47.48% of revenue; loss of any key customers may adversely affect the business, results of operations, and financial condition.
The company does not have any exclusivity arrangements with the customers and with the suppliers.
Any downturn or lack of demand for the company's spring technology products, which contribute to 80.11% of revenue, could have an adverse impact on its business operations.
The company is involved in a patent infringement suit, and an adverse outcome in this proceeding may adversely affect its growth strategy.
