Gala Precision Engineering Limited is coming up with an IPO worth INR 167.93 crores, consisting of a fresh issue of 0.26 crore shares worth INR 135.34 crores and an offer to sell 0.06 crore shares worth INR 32.59 crores. The company aims to establish new facilities, acquire equipment, repay borrowings, and support general operations.
Gala Precision Engineering IPO – Important Dates
| Gala Precision Engineering Limited IPO Date | September 2, 2024 to September 4, 2024 |
| Gala Precision Engineering Limited IPO Listing Date | September 9, 2024 |
| Gala Precision Engineering Limited IPO Price | INR 503-529 per share |
| Gala Precision Engineering Limited IPO Lot Size | 28 Shares |
| Gala Precision Engineering Limited IPO Total Issue Size | INR 167.93 crores |
| Gala Precision Engineering Limited IPO Basis of Allotment | September 5, 2024 |
| Gala Precision Engineering Limited IPO Initiation of Refunds | September 6, 2024 |
| Gala Precision Engineering Limited IPO Credit of Shares to Demat | September 6, 2024 |
| Gala Precision Engineering Limited IPO Issue Type | Book Built Issue IPO |
| Gala Precision Engineering Limited IPO Listing At | BSE, NSE |
Gala Precision Engineering Limited IPO – Company Profile
Gala Precision Engineering Limited manufactures technical springs, such as disc, strip, coil, and spiral springs, as well as special fastening solutions. It supplies OEMs globally, serving sectors including renewable energy, automotive, and industrial engineering.
Holding 70% of India’s renewables market, they capture 10% in domestic disc springs and 2% globally, competing with top firms. They also supply crucial automotive, railways, and heavy machinery components.
With 30+ years of experience, they excel in custom design, development, and precision machining, fostering strong customer relationships. Their advanced capabilities enable high-margin production across diverse industries, including renewables, automotive, and general engineering.
Gala Precision Engineering Ltd IPO Fundamental Analysis
Gala Precision Engineering Limited’s financial analysis reveals a mixed performance. Revenue shows strong growth, profitability has increased, and EPS has decreased, while debt reliance has decreased, indicating financial stability, improved liquidity, and efficient inventory management.
- Revenue Trend: The revenue increased from ₹1,452.77 million in March 2022 to ₹1,654.65 million in March 2023. The revenue for the current year’s 12-month period ending March 2024 is INR 2,025.45 million.
- Equity and Liabilities: Equity has shown a consistent increase over the periods, reflecting potential growth and expansion. However, the debt-equity ratio has decreased, indicating reduced reliance on debt financing.
- Profitability: The profit after tax (PAT) has increased from ₹66.31 million in March 2022 to ₹223.32 million by March 2024. The rise in profitability could be a source of confidence for investors.
- Earnings per Share (EPS): The diluted EPS has also increased from ₹6.44 in March 2022 to ₹24.02 by March 2024, reflecting higher earnings per share for investors.
- Return on Net Worth (RoNW): The RoNW has reduced from 11.18% to 23.27%, indicating a decrease in the company’s ability to generate returns on shareholder equity.
- Financial Position: Total assets have increased, suggesting potential business growth. However, the current ratio has increased, indicating strengthening liquidity and potential challenges in meeting short-term obligations.
- Inventory Turnover Ratio: There’s an increase in the Inventory Turnover Ratio, which might suggest strong sales or efficient inventory management.
Gala Precision Engineering IPO Financial Analysis
| Particular | As of 31 March 2022 | As of 31 March 2023 | As of 31 March 2024 |
| Revenue (₹ in Million) | 1,452.77 | 1,654.65 | 2,025.45 |
| Equity (₹ in Million) | 593.16 | 836.54 | 1,044.48 |
| Expenses (₹ in Million) | 1,367.35 | 1,493.84 | 1,767.90 |
| Profit and Loss After Tax (₹ in Million) | 66.31 | 242.12 | 223.32 |
| RoNW (%) | 11.18 | 17.28 | 23.27 |
| NAV per Equity Share (₹) | 58.66 | 82.85 | 103.30 |
| Diluted EPS only (₹) | 6.44 | 14.06 | 24.02 |
| Total Assets (in millions) | 1,456.17 | 1,703.86 | 1,886.85 |
| Total Liabilities (in millions) | 863.01 | 867.31 | 842.37 |
| Debt Equity Ratio | 0.96 | 0.70 | 0.53 |
| Current Ratio (in time) | 1.55 | 1.81 | 1.69 |
| Inventory Turnover Ratio | 3.26 | 3.14 | 3.57 |
Gala Precision Engineering Limited IPO Peer Comparison
Gala Precision Engineering Limited shows competitive EPS, RoNW, and market capitalization among peers like Harsha Engineers, SKF India, Sundram Fasteners, and Rolex Rings. Despite a smaller scale, it demonstrates strong financial performance and growth potential.
| Company | Type of financial | Total income (₹ in million) | Face Value per Equity Share (₹) | P/E | EPS (Basic) (₹) | EPS (Diluted) (₹) | RoNW (%) | NAV per Equity Share (Basic) (₹) |
| Gala Precision Engineering Limited | Consolidated | 2,043.77 | 10 | – | 24.37 | 24.02 | 23.27 | 103.30 |
| Harsha Engineers International Limited | Consolidated | 14,217.90 | 10 | 44.33 | 12.24 | 12.24 | 9.48 | 129.09 |
| SKF India Limited | Consolidated | 46,641.40 | 10 | 48.50 | 111.6 | 111.6 | 20.57 | 542.63 |
| Sundram Fasteners Limited | Consolidated | 57,204.70 | 1 | 54.49 | 24.83 | 24.83 | 15.37 | 162.81 |
| Rolex Rings Limited | Standalone | 12,368.19 | 10 | 40.83 | 57.30 | 57.30 | 17.37 | 329.81 |
| Sterling Tools Limited | Consolidated | 9,385.11 | 2 | 24.70 | 15.37 | 15.35 | 12.38 | 124.11 |
| Ratnaveer Precision Engineering Limited | Standalone | 6,024.00 | 10 | 24.69 | 7.61 | 7.61 | 12.32 | 51.78 |
Gala Precision Engineering Ltd IPO Objective
The main objective of Gala Precision Engineering Limited is to establish a new manufacturing facility, fund capital expenditure for equipment in Maharashtra, and repay or prepay outstanding borrowings to strengthen financial stability.
- Setting up a new facility at Vallam-Vadagal, SIPCOT, Sriperumbuddur, Tamil Nadu, to manufacture high-tensile fasteners and hex bolts: The company intends to utilize INR 37 crore from Net Proceeds to fund a new manufacturing facility in Tamil Nadu. This will expand its capacity for special fastening solutions, including foundation studs and hex bolts, enhancing its ability to serve existing and large customers effectively.
- Funding capital expenditure requirements towards the purchase of equipment, plant, and machinery at Wada, Palghar, Maharashtra: The company plans to utilize INR 11.07 crore to purchase machinery to increase hex bolt manufacturing capacity, enhance automation, and improve operational efficiency, safety, and quality at its Wada, Palghar facility in Maharashtra.
- Repayment/ prepayment, in whole or part, of certain borrowings availed by their company: The company aims to utilize INR 45.43 crore from the Net Proceeds to partially or fully repay existing borrowings, reduce debt servicing costs, improve the debt-equity ratio, and support future business growth and expansion.
- General Corporate Purposes: The company plans to use the net proceeds for general corporate purposes, including business development, design and development, operational expenses, salaries, rent, administration, insurance, repairs, taxes, and exploring inorganic growth opportunities.
Gala Precision Engineering IPO Risks And Challenges
Gala Precision Engineering Limited’s risk includes dependence on key customers, which exposes them to fluctuations and potential disruptions; ongoing patent infringement litigation affecting financial stability; and vulnerability to downturns in the springs technology sector impacting overall performance.
- Dependence on critical customers for a significant portion of their revenue exposes them to risks from their fluctuating demand, production changes, and industry conditions, which can impact their sales and lead to potential disruptions.
- The company is involved in a patent infringement suit regarding Wedge-Lock technology, alleging infringement by the manufacture and sale of “Gallock Washers.” The case in the Delhi High Court poses potential financial and operational risks.
- Their revenue is highly dependent on the springs technology segment. A downturn in this sector could significantly impact their business performance, cash flow, financial health, and overall results, posing a risk to their stability.
Gala Precision Engineering Ltd IPO – Industry & Market Potential
DSS & WLW are essential in off-highway vehicles, transmission lines, transformers, and elevators. The DSS & WLW market for Industrials is projected to reach ~$837M by CY26, driven by government investments and a ~6% CAGR from CY23-26.
The Indian automobile industry is growing, with ~23M vehicles produced annually and ~4M passenger vehicles sold in FY24. The DSS & WLW automobile market, crucial for clutch and brake mechanisms, was valued at ~$18M in FY24, with a ~10% CAGR through FY27.
The global fastener industry, vital for construction, renewables, and aerospace, is valued at ~$97B in CY23 and growing at a 6.7% CAGR. The market spans sectors including construction, railway development, and electrical equipment.
Gala Precision Engineering Limited IPO – Type of Offer
Gala Precision Engineering Limited plans a fresh issue of shares, seeking INR 135.34 crores to establish new facilities, acquire equipment, repay borrowings, and support general operations. Additionally, the company proposes an offer for sale, intending to sell 0.06 crore existing shares.
- Fresh Issue: The company will issue new shares to raise capital, aiming to collect INR 135.34 crores. The company intends to utilize the proceeds from the fresh issue to establish new facilities, acquire equipment, repay borrowings, and support general operations.
- Offer for sale: Gala Precision Engineering Limited is offering to sell 0.06 crore existing shares. The following are the details of the existing shareholders who are also the promoters selling the shares:
| Name of the promoter selling shareholder | Maximum number of offered shares for sale (in millions) |
| Taramati V Gala | 385,200 |
| Kirit Vishanji Gala (HUF) | 79,200 |
| Nayna Gala | 50,000 |
Gala Precision Engineering IPO Offer Size
The offer size of Gala Precision Engineering Limited is INR 167.93 crores, consisting of a fresh issue of 0.26 crore shares worth INR 135.34 crores and an offer to sell 0.06 crore shares worth INR 32.59 crores. The company seeks funds to establish new facilities, acquire equipment, repay borrowings, and support general operations.
Gala Precision Engineering Limited IPO Allotment Structure
Gala Precision Engineering Limited’s allocation will be as follows: 50% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 35% for Retail Individual Investors (RII) according to SEBI regulations.
● Qualified Institutional Buyers (QIB): As per SEBI regulations, 50% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers. These include entities such as banks, mutual funds, and insurance companies.
● Non-Institutional Investors (NII): 15% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs.2 lakhs.
● Retail Individual Investors (RII): The remaining 35% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs.2 lakhs.
How to apply for the Gala Precision Engineering IPO?
To apply for the Gala Precision Engineering Limited IPO through Alice Blue, follow these steps:
Open a Demat and Trading Account: If you don’t have one already, you must open a Demat and trading account with Alice Blue.
- Check for IPO Details: Once your account is active, you can check for the Gala Precision Engineering Limited IPO details in the IPO section of the Alice Blue platform.
- Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.
- Submit the Application: Confirm all your details and submit your application.
You can apply for the Gala Precision Engineering Limited IPO at Alice Blue in just a few clicks!
Check Allotment Status: After the allotment process, you can check the allotment status to see if you have received any shares.
Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.
How do you check the Gala Precision Engineering IPO Allotment Status?
Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:
- Log in to your Alice Blue Account: You can do this through the Alice Blue website or the trading app.
- Navigate to the Portfolio or IPO Section: This might differ based on the layout of Alice Blue’s platform, but generally, you can find the status of your IPO application under the ‘Portfolio’ or ‘IPO’ section.
- Find the IPO Allotment Status: Look for a sub-section called ‘IPO Allotment Status’ or something similar. This is where you can see the status of the IPOs you have applied for.
- Select the Gala Precision Engineering Limited IPO: If you have applied for multiple IPOs, there might be a dropdown menu or a list where you can select the IPO you are interested in. Select the Gala Precision Engineering Limited IPO.
- Check the Status: The status of your application should be displayed here. If the shares have been allocated to you, it would be mentioned here.
If you face any issues, we request you to reach out to our customer support team at Alice Blue for detailed assistance.
Apart from Alice Blue, there are other ways to check the allotment status of the Gala Precision Engineering Limited IPO:
● Registrar’s Website: Visit the website of Link Intime India Private Limited, the registrar of the Gala Precision Engineering Limited IPO. On the homepage, look for the ‘IPO Allotment Status’ option. You must enter your PAN, application, or Demat account number to check your allotment status. Click on the ‘Submit’ button to view your IPO allotment status.
● BSE NSE: You can also check the allotment status on the official websites of the Bombay Stock Exchange (BSE) National Stock Exchange (NSE). You would need your application number and PAN to check the status.
Please note that the allotment status will only be available after completing the allotment process, a few days after the IPO window closes.
Gala Precision Engineering Ltd IPO Offer Registrar
The registrar for the Gala Precision Engineering Limited IPO is Link Intime India Private Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.
Contact information for the registrar:
Link Intime India Private Limited
C- 101, 1st Floor, 247 Park, L.B.S Marg,
Vikhroli (West), Mumbai – 400083,
Maharashtra, India
Telephone: +91 810 811 4949,
Email: [email protected]
Website: www.linkintime.co.in
Gala Precision Engineering IPO – FAQs
1. What is the allotment date of the Gala Precision Engineering IPO?
The allotment date of the Gala Precision Engineering Limited IPO is September 5, 2024.
2. What is the price band of the Gala Precision Engineering IPO?
The price band of the issue is INR 503-529 per share.
3. What is the size of the Gala Precision Engineering IPO?
The offer size of Gala Precision Engineering Limited is INR 167.93 crores, consisting of a fresh issue of 0.26 crore shares worth INR 135.34 crores and an offer to sell 0.06 crore shares worth INR 32.59 crores. The company seeks funds to establish new facilities, acquire equipment, repay borrowings, and support general operations.
4. What is the listing date of the Gala Precision Engineering IPO?
The listing date of Gala Precision Engineering Limited’s IPO is September 9, 2024.
