Gala Precision Engineering Limited manufacturer precision components such as disc and strip springs, coil and spiral springs , and special fastening solutions. Gala Precision Engineering IPO aims to raise167.93 crores as a combination of fresh issue and offer for sale aggregating to Rs 32.59 crores.
IPO opens
September 2, 2024
IPO Closes
September 4, 2024
IPO Size (Rs.)
₹167.93 Cr
Breakup
Fresh issue ₹135.34 Cr+ OFS ₹32.59 Cr
Face Value:
₹ 10
IPO Price in Rs :
₹503 to ₹529 per share
Minimum Lot
28 Shares
Listing At
NSE , BSE (mainboard)
QIB
~50 %
NII Quota
~15%
Retail Quota
~35%
Lead Manager
PL Capital Markets Private Limited
Registrar
Link Intime
AboutGala Precision Engineering:
The Company was incorporated as ‘Gala Precision Engineering Pvt. Ltd’ in February 23, 2009..
The company is a precision component manufacturer of technical springs like disc & strip springs (“DSS”) including wedge lock washers; coil & spiral springs (“CSS”) and special fastening solution (“SFS”).
The company operates from 2 manufacturing facilities located in Wada, Palghar, Maharashtra.
As of March 31, 2024, the company has an annual production capacity of 246.46 million units of springs and washers and 0.42 million fasteners.
The company has developed and delivering over 750 stock keeping units of products to meet customer requirements. Further, it has developed more than 200 products for different technical springs and high tensile fasteners, over the last 5 years.
Financials : Gala Precision Engineering IPO
Particulars / Rs. Cr
2024
2023
2022
Revenue from Operations
202.55
165.47
145.28
Revenue Growth (%)
22.41
13.9
–
EBITDA
40.59
28.94
22.35
EBITDA Margin (%)
19.86
17.32
15.11
PAT
22.33
24.21
6.63
PAT (%)
10.93
14.49
4.48
Share Capital
10.11
2.52
2.53
Net Worth
104.4
83.7
59.3
Total Borrowings
55.03
58.6
56.89
RONW (%)
21.38
28.94
11.18
ROE (%)
23.27
17.28
11.18
Post issue Share Capital
12.67
FV
10.0
IPO price
529.0
EPS Fy23
19.1
PE Fy24
27.7
EPS Fy24
17.6
PE Fy24
30.0
Market cap in Lacs
670
Market cap / Sales
3.31
Anchor: Gala Precision Engineering IPO
Salient Points: Gala Precision Engineering IPO
Offer For Sale (OFS) is relatively small and mainly by the promoter who stake will come down from 75% to 55% .
For the Rs. 135 cr Fresh Issue proceeds , capex will account for Rs. 48 cr and debt repayment of Rs. 45 cr.
Company is setting up new manufacturing facility at SIPCOT, Sriperumbuddur, Tamil Nadu for developing various high tensile fasteners and bolts.
This greenfield plant is coming closer to its wind energy customers in South India, including some of the largest wind turbine generator manufacturers globally. The Tamil Nadu plant is likely to be commissioned in phases, beginning Q4FY25E a
Gala Precision Engineering manufactures disc strip springs(DSS), coil spiral springs(CSS) and fasteners with revenue of 60:20:20 between these products,
The company exports its products to 25+ countries to global clientele exceeding 175 customers in major markets such as Germany, Denmark, China, Italy, Brazil, USA, Sweden, Switzerland. Exports contributed 37.53% to total sales in 2024.
The company had a share of ~2% of the global DSS & WLW market, as of CY2023. The company is a key disc springs manufacturer in domestic market and has ~10% market share in the Indian disc springs market.
The company has a good presence in the DSS market for renewable industry with ~70% share in the domestic market and ~3% share in the global market.
The company has long-standing relationships with OEMs, Tier 1 players and channel partners customers ranging from 4 years to more than 15 years.
Capacity utilization is high about 70-85% across all the three product categories, With ongoing and plabnned expansion, company can acheive better metrics. expansion of nearly Rs. 60 cr.
Company to become to become almost net debt free after IPO.
Company revenue has grown at 18% CAGR between FY22-FY24, with 40% CAGR in operating EBITDA, to Rs. 39 cr in FY24.
P/E ratio stands at 30x. .
I intend to apply in Gala Precision Engineering IPO. The company should perform well due to ongoing and p[planned capacity expansion. They are a well established manufacturer of precision engineering components with diversified product portfolio and diverse market with several products catering to renewable sector particularly wind energy.
GMP as reported on social media has been Rs. 250.
This post is exploratory and educational purposes only. Please do your own diligence before investing in SME IPOs like this.
Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.
