Rs 5,500 crore Sona BLW IPO to open on Monday; price band fixed at Rs 285-291

Rs 5,500 crore Sona BLW IPO to open on Monday; price band fixed at Rs 285-291

NEW DELHI: Sona BLW Precision Forgings’ on Wednesday fixed the price band of its Rs 5,500 crore initial public offering (IPO) at Rs 285-291 apiece. The issue will open on Monday and close on Wednesday.

Investors can bid for a minimum lot of 51 shares and in multiples thereafter.

On the block is a fresh issuance of equity shares, aggregating up to Rs 300 crore and an offer for sale of up to Rs 5,250 crore with of shares. Selling shareholders include Singapore VII Topco III Pte.

Sona BLW intends to utilise the proceeds from the Rs 300 crore fresh issue to repay approximately Rs 241.12 crore of its identified borrowings. It will spend the rest on general corporate purposes.

Sona BLW Precision is among the leading automotive technology companies. It is primarily engaged in designing, manufacturing and supplying highly engineered, mission-critical automotive systems and components to automotive OEMs.

The company has nine manufacturing and assembly facilities across India, China, Mexico and USA, out of which six are located in India.

The company is a leading supplier of BLDC motors in India for the two-wheeler and three-wheeler EV market, according to the Ricardo Report. It derived 13.8 per cent of revenue from the Battery EV market and 26.7 per cent from the micro-hybrid or hybrid market in FY21.

Its global market share of BEV differential assemblies in calendar year 2020 was 8.7 per cent.

The company is among the top 10 players globally in the differential bevel gear market and in the starter motor market on the basis of respective volumes supplied to its end segments in calendar year 2020 and has been gaining global market share across products.

The company reported the highest operating Ebitda margin, PAT margin, ROCE and ROE in FY20, compared with top 10 listed auto component manufacturers in India by market capitalisation. It has consistently delivered more than 26 per cent Ebitda margin and more than 35 per cent average ROE each year over FY19-21. Its operating income growth over FY16-20 has exceeded the average of the same peer set, the company claimed.

Kotak Mahindra Capital Company, Credit Suisse Securities (India), JM Financial,JP Morgan India and Nomura Financial Advisory and Securities (India) are the BRLMs to the offer.

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