Jyoti CNC Automation IPO: All You Need To Know
The net proceeds will be used for repayment and/or prepayment of certain borrowings and long-term working capital requirements.
Jyoti CNC Automation Ltd. will launch its initial public offering on Tuesday to raise up to Rs 1,000 crore via a fresh issue.
The price band is fixed at Rs 315–331 per share. The three-day IPO closes on Thursday.
Of the total issue size, 75% is reserved for qualified institutional buyers, 15% for non-institutional investors and the remaining 10% for retail individual investors.
Issue Details
Issue opens: Jan. 9.
Issue closes: Jan. 11.
Total issue size: Rs 1,000 crore.
Face value: Rs 2 apiece.
Fixed price band: Rs 315–331 per share.
Minimum lot size: 45 shares.
Listing: NSE and BSE.
Use Of Proceeds
The net proceeds from the issue will be utilised towards the following:
Repayment and/or prepayment, in full or in part, of certain borrowings availed by the company.
Funding the long-term working capital requirements of the company.
General corporate purposes.
Business
Incorporated in 1991, the Rajkot-based company is a computerised-numerical-control manufacturer and supplier. It has a wide range of CNC machines, with a product range that includes turning centres and vertical and horizontal machining centres.
As of June 30, 2023, Jyoti's production capacity was 4,400 machines per year in India and 121 machines per year in France. In the last three financial years, it has supplied over 7,200 machines to more than 3,000 customers, including the Space Applications Center.
The company also has 29 sales and service centres in Romania, France, Poland, Belgium, Italy and the UK.
Risk Factor
Jyoti does not have long-term agreements with any of its suppliers for input materials. Therefore, a rise in costs or shortfall in availability can affect the financials of the firm.
It is completely reliant on third-party logistics service providers for transport of input materials and finished products.
The company is very dependent on the performance of the application industries, such as automobile, general engineering and defence, as a large amount of its revenue is dependent on the sectors.
In the first six months of the current financial year, 37% and 35% of its sale of machinery revenue came from the defence/aerospace and automobile sectors respectively.
Employee-benefit expenses form a huge share of the total expenses. Any increase in the liner can affect operations.
The company is heavily dependent on machinery for its operations. Any breakdown of its machinery can impact its operations and financials.
There are legal matters worth Rs 41.6 crore against the company and Rs 4 crore against its subsidiary.
