Gala Precision Engineering Limited, a leading manufacturer of precision components like disc and strip springs (DSS), coil and spiral springs (CSS), and special fastening solutions (SFS), has set the price band for its initial public offering (IPO) at ₹503 to ₹529 per equity share, with a face value of ₹10 each. The IPO will be open for subscription from Monday, September 2, 2024, to Wednesday, September 4, 2024. Investors can place bids starting at a minimum of 28 equity shares, with additional bids in multiples of 28 shares.
The IPO comprises a fresh issue of up to 2,558,416 equity shares and an offer for sale (OFS) of up to 616,000 equity shares by the Promoter Group and Individual Selling Shareholders.
Proceeds from the fresh issue will be allocated as follows: ₹370 million for establishing a new manufacturing facility for high-tensile fasteners and hex bolts in Vallam-Vadagal, SIPCOT, Sriperumbudur, Tamil Nadu; ₹110.69 million for capital expenditure, including the purchase of equipment, plant, and machinery at Wada, Palghar, Maharashtra; ₹454.30 million for repaying or prepaying certain borrowings; and the remainder for general corporate purposes.
Under the leadership of Kirit Vishanji Gala, Gala Precision Engineering is a technology-driven company with a strong emphasis on quality, design tool development, and application engineering. With over three decades of experience, the company specializes in creating customized products to meet the evolving demands of its customers and holds an estimated 15% market share in the domestic SFS market for wind turbines. Gala Precision supplies its products to original equipment manufacturers (OEMs), Tier 1 suppliers, and channel partners. in sectors like renewable energy including wind turbine and hydro power plants, various industrial sectors such as electrical, off-highway equipment, infrastructure and general engineering, mobility segments such as automotive and railways.
Its technical springs and high tensile fasteners have been supplied to customers in countries such as Germany, Denmark, China, Italy, Brazil, USA, Sweden, Switzerland etc. Accordingly, it is a key link in the global supply chain for OEMs.
Its business primarily comprises of springs technology division, under which it manufactures DSS including wedge lock washers (“WLW”), CSS and SFS in which it manufactures anchor bolts, studs and nuts.
The Company operates its business from its two manufacturing facilities located in Wada, Palghar, Maharashtra. Further, it is also setting up a new manufacturing facility in Vallam-Vadagal, SIPCOT, Sriperumbuddur, Tamil Nadu for developing various high-tensile fasteners to add to its existing product portfolio and new products.
For fiscal 2023–24, the company’s revenue from operations increased by 22.41%, reaching to ₹2025.45 million in Fiscal 2024 from ₹1654.65 million in Fiscal 2023, driven incremental sales of DSS due to the addition of new customers and increased demand from renewable energy, railways and industrial sectors; as well as incremental sales of CSS, owing to increased demand from the automobile industry and the commencement of supplies to the railways. Profit after tax for the fiscal 2024 stood at ₹223.32 million.
PL Capital Markets Private Limited is the sole book running lead manager and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.
The Offer is being made through the Book Building Process, wherein not more than 50% of the Offer shall be available for allocation to Qualified Institutional Buyers, not less than 15% of the offer shall be available for allocation to Non-Institutional Bidders and not less than 35% of the Offer shall be available for allocation to Retail Individual Bidders.
