Gala Precision Engineering has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds via the initial public offering (IPO) route.
The Mumbai-based precision component manufacturer of technical springs will launch its public offer which will be a mix of issue of fresh equity shares and an offer for sale (OFS).
The face value of shares is Rs 10. The fresh issue comprises up to 25.58 lakh shares and the OFS of up to 6.16 lakh equity shares that will be offloaded by the promoter Group and individual selling shareholders. The offer also includes a reservation for subscription by eligible employees.
Read More: Vibhor Steel Tubes IPO: Step By Step Guide To Check Allotment Status Online On BSE
Under the OFS, up to 385,200 shares will be offered by Vishanji Harshi Gala while up to 58,600 equity shares by Kirit Vishanji Gala (HUF).
Up to 50,000 equity shares will be sold by Nayna Gala and up to 40,000 equity shares by Satish Kotwani. Others to offer their share will be Hemlata Dhiraj Shah (up to 31,400 shares), Dhiraj Nanchand Shah (28,000 shares), Urmil Dhiraj Shah (12,800 shares) and Rupa Sunil Mehta (up to 10,000 shares).
The offer is being made through the book-building process, wherein up to 50% will be allocated to qualified institutional buyers (QIBs), 15% to non-institutional bidders and 35% to retail individual bidders.
The company will utilise nearly Rs 37 crore from the IPO proceeds for setting up a new facility at Vallam-Vadagal in Tamil Nadu for manufacturing high tensile fasteners and hex bolts. It will use Rs 11.07 crore for funding capital expenditure requirements towards the purchase of equipment, plant and machinery at Wada, Palghar, Maharashtra.
Meanwhile, Rs 30 crore will be used for repayment/prepayment of certain borrowings and general corporate purposes.
Read More: Bumper IPO week: 4 new issues, 7 listings expected to boost up stock market next week
About Gala Precision
Led by Kirit Vishanji Gala, the company is technology-driven with a strong focus on quality, design tool development, and application engineering. It has more than 3 decades of experience in developing customised products and commands approximately 15% market share in the domestic SFS (special fastening solution) market for wind turbines.
Gala Precision’s business primarily comprises the springs technology division, which manufactures DSS including wedge lock washers, coil & spiral springs and SFS which manufactures anchor bolts, studs, and nuts.
Gala Precision boasts of clients such as John Deere India, Faiveley Transport Rail Technologies, Brembo Brake, L&T Electrical & Automation Products and Schaeffler India among others. The exports are in over 25 countries including major markets such as Germany, Denmark, China, Italy, Brazil, USA, Sweden and Switzerland.
Read More: GPT Healthcare IPO To Open On Feb 22, BanyanTree Growth Capital To Exit
For fiscal 2022–23, the company’s revenue from operations increased by 13.90% to Rs 165.46 crore against Rs 145.28 crore for fiscal 2021–22. Profit after tax increased 265.13% to Rs 24.21 crore in fiscal 2023 from Rs 6.63 crore in fiscal 2022.
For the six months ended September 30, 2023, revenue from operations stood at Rs 95.68 crore, and profit after tax stood at Rs 9.60 crore.
PL Capital Markets Private is the sole book-running lead manager for the IPO and Link Intime India Private Limited is the registrar of the offer. The equity shares are proposed to be listed on the BSE and NSE.
