Automobile and Auto Components IPOs in India allow companies in the auto sector to raise capital. These IPOs reflect growth opportunities, attract investor interest, and contribute to expanding the nation’s manufacturing and mobility landscape.
Content:
- Overview of the Automobile and Auto Components IPOs in India
- IPO Fundamental Analysis
- IPO Financial Analysis
- About the Company
- Advantages of Investing in Automobile and Auto Components Sector IPOs
- Disadvantages of Investing in Automobile and Auto Components Sector IPOs
- Role of the Automobile and Auto Components Industry in the Economy
- How to invest in Automobile and Auto Components IPOs?
- Future Outlook of Automobile and Auto Components IPOs in India
- Automobile and Auto Components IPOs in India – FAQ
Overview of the Automobile and Auto Components IPOs in India
Automobile and Auto Components IPOs in India provide companies a platform to raise funds, fueling growth in production and innovation. These IPOs attract investor interest, boosting market visibility and reflecting the sector’s vital role in the economy.
Key IPOs in this space underline the evolving demand for vehicles and components, driven by modernization and electrification trends. Companies leverage public funding to enhance capabilities, expand networks, and meet global standards, contributing significantly to India’s manufacturing ecosystem.
IPO Fundamental Analysis
Mandeep Auto Industries Ltd
Mandeep Auto Industries Ltd’s financial results for FY24 show a modest increase in sales to ₹24.7 crore from ₹16.57 crore in Dec 2023, while expenses grew to ₹20.94 crore. Operating profit stood at ₹3.76 crore with an OPM of 15.22%, reflecting stable growth.
Revenue Trend: Mandeep Auto’s revenue grew from ₹16.57 crore in Dec 2023 to ₹24.7 crore in Mar 2024, showing consistent growth driven by increased sales, though at a slightly lower OPM of 15.22% compared to 20.52% in December 2023.
Equity and Liabilities: The company’s equity capital remained constant at ₹6.57 crore, while reserves increased to ₹2.13 crore in Mar 2024 from ₹1.64 crore. Borrowings decreased slightly to ₹7.88 crore, reflecting improved capital efficiency.
Profitability: Mandeep Auto’s operating profit increased to ₹3.76 crore in Mar 2024 from ₹3.4 crore in Dec 2023, but the operating profit margin (OPM) saw a slight decrease, standing at 15.22% from 20.52% in the previous quarter.
Earnings Per Share (EPS): EPS slightly declined from ₹3.27 in Dec 2023 to ₹3.24 in Mar 2024, indicating a stable but marginally reduced return on equity for the period.
Return on Net Worth (RoNW): The company’s RoNW for FY24 has been impacted by a higher tax rate of 32.49% compared to 25.69% in Dec 2023, slightly lowering profitability despite stable overall profits.
Financial Position: Mandeep Auto’s total assets stood at ₹24.45 crore in Mar 2024, with minimal changes in liabilities. The company maintained a stable balance sheet, with total liabilities at ₹24.45 crore, showing effective management of debt and capital.
Thaai Casting Ltd
Thaai Casting Ltd’s financial results for FY24 show sales of ₹71 crores with expenses totalling ₹51 crore. Operating profit stood at ₹20 crore, yielding an operating profit margin (OPM) of 28%. The company reported a net profit of ₹11 crore with an EPS of ₹4.61.
Revenue Trend: Thaai Casting’s sales reached ₹71 crore in FY24, demonstrating solid growth. The operating profit margin (OPM) stood at 28%, reflecting a strong performance despite a relatively high-cost structure of ₹51 crore in expenses.
Equity and Liabilities: Thaai Casting’s equity capital is ₹23 crore, with reserves amounting to ₹49 crore. The company’s borrowings are ₹46 crore, leading to total liabilities of ₹135 crore, a balanced structure with high capital reserves.
Profitability: Thaai Casting reported an operating profit of ₹20 crore in FY24, with a healthy operating profit margin (OPM) of 28%. This indicates robust profitability despite substantial expenses and interest costs of ₹3 crore.
Earnings Per Share (EPS): Thaai Casting posted an EPS of ₹4.61 for FY24, driven by a solid net profit of ₹11 crore. This suggests effective capital utilization, though the dividend payout ratio remains at 0%.
Return on Net Worth (RoNW): Thaai Casting’s return on net worth (RoNW) is strong, benefiting from the profit of ₹11 crore. The RoNW reflects the efficient use of equity capital, but further analysis would be required to determine long-term trends.
Financial Position: Thaai Casting’s total assets stand at ₹135 crore, with fixed assets contributing ₹61 crore. The company’s liabilities total ₹135 crore, indicating a leveraged structure, though balanced by substantial reserves of ₹49 crore.
Viaz Tyres Ltd
Viaz Tyres Ltd’s financial results for FY24 show a 9.7% increase in sales, reaching ₹50.37 crore, compared to ₹45.92 crore in FY23. The company’s operating profit stood at ₹5.08 crore with an operating profit margin (OPM) of 10.09%. Net profit for FY24 was ₹2.37 crore, with an EPS of ₹1.93.
Revenue Trend: Viaz Tyres’ sales grew to ₹50.37 crore in FY24, up from ₹45.92 crore in FY23. The growth indicates strong market demand, though the operating profit margin (OPM) slightly decreased from 10.67% in FY23 to 10.09% in FY24.
Equity and Liabilities: The company’s equity capital remained at ₹12.25 crore in FY24, with reserves increasing to ₹21.22 crore. Borrowings rose to ₹13.54 crore, leading to total liabilities of ₹50.88 crore, reflecting increased leverage for expansion.
Profitability: Viaz Tyres reported a profit before tax of ₹3.07 crore in FY24, with net profit rising to ₹2.37 crore. However, the operating profit margin (OPM) decreased to 10.09% from 15.17% in FY22, indicating rising costs.
Earnings Per Share (EPS): The EPS for FY24 is ₹1.93, a notable increase from ₹1.65 in FY23. However, it is lower compared to ₹3.39 in FY22, reflecting changes in profitability and market conditions.
Return on Net Worth (RoNW): Viaz Tyres posted a return on equity (RoE) of 7% in FY24. This indicates moderate returns on shareholders’ equity, reflecting the company’s ability to generate profits relative to its equity capital.
Financial Position: Viaz Tyres’ total assets increased to ₹50.88 crore in FY24, driven by a rise in fixed assets to ₹11.86 crore. Total liabilities also grew, reflecting the company’s investment in expanding its operational base.
IPO Financial Analysis
Mandeep Auto Industries Ltd
| FY 24 | FY 23 | |
| Sales | 24.7 | 16.57 |
| Expenses | 20.94 | 13.17 |
| Operating Profit | 3.76 | 3.4 |
| OPM % | 15.22% | 20.52% |
| Other Income | 0.14 | 0 |
| Interest | 0.54 | 0.4 |
| Depreciation | 0.19 | 0.12 |
| Profit Before Tax | 3.17 | 2.88 |
| Tax % | 32.49% | 25.69% |
| Net Profit | 2.13 | 2.15 |
| EPS | 3.24 | 3.27 |
All values in ₹ Cr.
Thaai Casting Ltd
| FY 24 | |
| Sales | 71 |
| Expenses | 51 |
| Operating Profit | 20 |
| OPM % | 28% |
| Other Income | 0 |
| Interest | 3 |
| Depreciation | 2 |
| Profit Before Tax | 14 |
| Tax % | 26% |
| Net Profit | 11 |
| EPS | 4.61 |
All values in ₹ Cr.
Viaz Tyres Ltd
| FY 24 | FY 23 | FY 22 | |
| Sales | 50.37 | 45.92 | 29.2 |
| Expenses | 45.29 | 41.02 | 24.77 |
| Operating Profit | 5.08 | 4.9 | 4.43 |
| OPM % | 10.09% | 10.67% | 15.17% |
| Other Income | 0.33 | 0.36 | 0.11 |
| Interest | 1.14 | 1.28 | 1.36 |
| Depreciation | 1.2 | 1.27 | 1.44 |
| Profit Before Tax | 3.07 | 2.71 | 1.74 |
| Tax % | 22.80% | 25.46% | 17.24% |
| Net Profit | 2.37 | 2.02 | 1.44 |
| EPS | 1.93 | 1.65 | 3.39 |
All values in ₹ Cr.
About the Company
Mandeep Auto Industries Ltd
Mandeep Auto Industries Limited, established in 2000, specializes in manufacturing sheet metal components, sprocket gears, and machined parts. Its products cater to diverse industries, including automobiles, tractors, railways, defence, and material handling equipment, showcasing a wide industrial application range.
With ISO 14001:2015 and ISO 9001:2015 certifications, Mandeep Auto Industries collaborates with domestic and global automobile OEMs. Prominent clients include J.L Auto Parts Pvt. Ltd. and Tube Investments of India Limited, reflecting the company’s commitment to quality and innovation in the auto components sector.
Thaai Casting Ltd
Thaai Casting Ltd, established in June 2010, specializes in High-Pressure Die Casting and precision machining of ferrous and non-ferrous materials. The company also offers induction heating and quenching, serving as a critical automotive ancillary manufacturer.
IATF 16949:2016 certified, Thaai Casting produces diverse components, including engine mounting brackets, transmission mounts, and steering wheel armatures. Located in Tiruvallur, Tamil Nadu, the facility features advanced die-making capabilities, ensuring continuous operations and extended die lifespan.
Viaz Tyres Ltd
Viaz Tyres Limited, founded in 2018 and headquartered in Ahmedabad, specializes in manufacturing rubber tubes for bicycles, two-wheelers, passenger, and industrial vehicles. Its products, sold under the brand “Viaz,” cater to both domestic and international markets.
The company operates a production facility in Nandasan, Gujarat, with a 7,00,000 tubes-per-month capacity. With 15 distributors across India, it also exports to the USA, Turkey, Romania, UAE, and Colombia. Recently, it began trading Maxxis Rubbers tyres exclusively in Turkey.
Advantages of Investing in Automobile and Auto Components Sector IPOs
The main advantage of investing in Automobile and Auto Components Sector IPOs is the sector’s growth potential, driven by increasing demand, technological advancements, and expanding global markets. These IPOs offer early access to companies poised for long-term success.
- Industry Growth Potential: Automobile and auto components are critical sectors in India’s industrial landscape, benefiting from both domestic demand and global trade. Investment in these IPOs taps into a growing market with rising vehicle production and increasing exports.
- Diversification Opportunities: Investing in automobile and auto components IPOs offers exposure to various sub-sectors such as electric vehicles, parts manufacturing, and technology innovation. This helps diversify investment portfolios and minimizes risk by leveraging different industry segments.
- Technological Advancements: The automotive sector is increasingly driven by technological innovations, particularly in electric vehicles (EVs), autonomous driving, and green technologies. IPOs in this space provide opportunities to invest in cutting-edge innovations shaping the future of mobility.
- Stable Cash Flow: Many auto component manufacturers have well-established supply chains and consistent demand for their products. These companies often generate stable cash flows, making their IPOs attractive for investors seeking steady returns and long-term growth potential.
Disadvantages of Investing in Automobile and Auto Components Sector IPOs
The main disadvantage of investing in Automobile and Auto Components Sector IPOs lies in the market’s volatility, regulatory risks, and dependence on economic cycles. These factors can negatively affect the performance of companies in this sector, making them less predictable.
- Market Volatility: The automobile sector is highly sensitive to economic fluctuations, leading to stock price volatility. Market conditions such as changes in fuel prices, supply chain disruptions, or fluctuating demand can negatively impact IPO performance.
- Regulatory Risks: Automobile manufacturers and component suppliers must comply with stringent regulations related to safety, emissions, and environmental standards. Any changes in government policies or non-compliance can disrupt operations and affect profitability.
- Competition: The automobile and auto components sectors are highly competitive, with numerous players vying for market share. New entrants, technological advancements, or price wars can erode the market share and profit margins of established companies.
- Economic Dependence: The sector’s performance is closely tied to economic cycles. Economic downturns, reduced consumer spending, or shifts in consumer preferences (such as the transition to electric vehicles) may result in slower growth or losses for companies in the sector.
Role of the Automobile and Auto Components Industry in the Economy
The automobile and auto components industry is a key driver of economic growth in India, contributing significantly to employment and GDP. It supports sectors like manufacturing, steel, and electronics while promoting innovation in engineering, sustainability, and technology integration, such as electric vehicles (EVs).
This sector also plays a pivotal role in boosting exports, as India is a major hub for automotive manufacturing. With global demand for vehicles and auto parts increasing, it strengthens trade relations and foreign investments. The growth in domestic vehicle sales further stimulates ancillary industries, including logistics and retail.
How to invest in Automobile and Auto Components IPOs?
To invest in Automobile and Auto Components IPOs, follow these steps:
- Open a Demat and Trading Account: Choose a brokerage platform like Alice Blue.
- Research IPO Details: Review the company’s prospectus, pricing, and performance.
- Place Your Bid: Log in to the brokerage account, select the IPO, and bid as per your preferences.
- Monitor and Confirm Allocation: If allocated, your shares will be credited to your Demat account after listing.
Future Outlook of Automobile and Auto Components IPOs in India
The future outlook for Automobile and Auto Components IPOs in India remains optimistic, driven by increasing domestic demand and exports. As the automotive sector evolves with electrification and technological advancements, companies in the auto components sector are expected to grow, making IPOs attractive investment options.
With expanding infrastructure and government support for electric vehicles, the industry offers promising growth. IPOs by emerging auto and component manufacturers will provide new investment opportunities, attracting both institutional and retail investors looking for diversification in a high-potential sector.
Automobile and Auto Components IPOs in India – FAQ
An Automobile and Auto Components IPO is when a company in the automotive sector offers its shares to the public for the first time. It allows investors to buy into companies that manufacture vehicles, parts, and accessories, aiming for capital growth.
The major Automobile and Auto Components companies in India that have launched IPOs include Mandeep Auto Industries Ltd, Thaai Casting Ltd, and Viaz Tyres Ltd. These companies specialize in manufacturing auto parts, casting, and rubber tubes for various vehicles.
Automobile and Auto Components IPOs play a vital role in India’s stock market by boosting sectoral growth, attracting investments, and enhancing liquidity. They help fund innovation and expansion in the automotive industry, driving economic development and creating job opportunities.
The largest Automobile and Auto Components IPO in India is from Thaai Casting Ltd, which raised approximately ₹47.20 Cr. This IPO was significant due to the company’s strong market position in automotive technology, particularly in electric vehicle components.
To invest in Automobile and Auto Components IPOs, open a Demat and trading account with platforms like Alice Blue. Choose the IPOs you’re interested in, apply online through your broker, and follow the bidding process. Ensure adequate funds in your account.
Automobile and Auto Components IPOs can be suitable for long-term investment if the company has strong growth potential, a solid track record, and a competitive position in the market. However, these sectors can be volatile and sensitive to economic cycles.
Automobile and Auto Components IPOs can be profitable for investors if they target companies with strong growth potential and solid market positioning. However, the sector’s cyclical nature and sensitivity to economic factors may lead to volatility, impacting short-term returns.
Yes, there are several upcoming Automobile and Auto Components IPOs in India. These IPOs reflect the growing demand and expansion in the sector, with several companies preparing to raise capital for business growth, expansion, and development. Keep an eye on financial news platforms for the latest updates on specific offerings and filing details.
You can find detailed reviews and analyses of Automobile and Auto Components IPOs on financial analysis platforms and stock market websites. Brokerage firms like Alice Blue offer insights, expert opinions, and reports. Websites dedicated to stock market data often provide in-depth IPO analysis.
Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.
