Harsha Engineers International has filed Draft Red Herring Prospectus (DRHP) with the Securities and Exchanges Board of India (SEBI) to raise Rs 755 crore through an initial public offering (IPO). The company claims to be the largest manufacturer of precision bearing cages, in terms of revenue in India.  

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The Ahmedabad-based company offers a wide range of bearing cages starting from 20 mm to 2,000 mm in diameter. It also manufactures complex and specialised precision stamped components, welded assemblies, brass castings and cages & bronze castings and bushings. 

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The offer consists of a fresh issue of equity shares aggregating to Rs 455 crore, and an offer for sale of up to Rs 300 crore by existing shareholders, according to the prospectus papers filed with regulator.  

The offer of sale comprises up to Rs 66.75 crore by Rajendra Shah, up to Rs 75 crore by Harish Rangwala, up to Rs 16.50 crore by Pilak Shah, up to Rs 75 crore by Charusheela Rangwala, up to Rs 66.75 crore by Nirmala Shah.   

The offer also includes a reservation for subscription by eligible employees.  

The net proceeds from the fresh issue will be utilised to the tune of up to Rs 270 crore for part repayment/pre-payment of loans availed from lenders, up to Rs 77.95 crore for funding working capital requirements towards purchase of machinery, up to Rs 7.12 crore for infrastructure repairs and renovation of the existing production facilities and general corporate proposes.  

Axis Capital Limited, Equirus Capital Private Limited and JM Financial Limited are the book running lead managers to the issue.   

The bearing company has made a profit of Rs 45.44 crore on revenue of Rs 873.75 crore for FY21, with two-thirds of the income came from outside India for last three fiscals. For the six months ending September 30, 2021, it clocked a profit of Rs 43.71 crore on revenue of Rs 629.46 crore, that is 64.6 per cent of its revenue.  

As of September 30, 2021, Harsha Engineers has manufactured more than 7,205 bearing cages and more than 295 other products, a company statement said. In addition, over the past three years its product development and innovation centre has developed more than 1,200 products in different bearing types, it further said.