Maini Precision Products files for IPO with SEBI - Top 10 things investors must know

Maini Precision Products Limited (MPPL) has filed preliminary papers with capital market regulator Securities and Exchange Board of India (Sebi) to raise funds through an initial share-sale.  The Bengaluru-based company is an end-to-end solution provider in areas including process design, engineering, manufacturing, testing, and supply of a variety of precision products with close tolerances of up to 3 microns and assemblies. 

Investors must know these top 10 things about the company and its IPO:

1) Amount to raise: The company will raise between Rs 800-900 crore via this initial public offering (IPO) as per market sources. 

2) IPO Price Band: The price band is yet to be announced. According to the Draft Red Herring Prospectus (DRHP), the IPO with a face value of Rs 2 per equity share.

3) IPO Issue Size: It must be noted that the company consists of a fresh issue of equity shares aggregating to Rs 150 crore.

4) Lot size and minimum & maximum order: As a part of the OFS, promoters will offload 60,20,765 equity shares, individual shareholders to sell up to 6,45,865 equity shares, up to 5,13,390 by other selling shareholders and 1,83,01,685 equity shares by investor shareholders.

5) Offer details: As per the company, there is the offer for sale of up to 2,54,81,705 equity shares.

6) Objective of the IPO: The proceeds from the fresh issue will be used to repay/prepay Rs 112.5 crore of its borrowings and will be used for general corporate purposes.

7) Book Running Lead Manager and registrar: ICICI Securities Limited, IIFL Securities Limited are the book running lead managers to the issue.

8) Company details: Promoted by Sandeep Kumar Maini, Gautam Maini and Chetan Kumar Maini, the company was incorporated in 1973. Maini is capable of diverse and critical manufacturing and finishing processes, including machined castings, die castings, machined forgings, bar route machining, plate machining, surface treatment, heat treatment, critical assembly, as well as ancillary activities such as end of line testing, export packing and warehousing, which encompasses end-to-end solutions for its customers both domestic and global.

9) Revenue: Being an export oriented business primarily exporting to United States of America, France, Sweden, Italy, Slovakia, England, Japan, Spain, Poland and Germany, its revenue from operations stood at Rs 560.30 crore for FY19, Rs 570 crore for FY20 and Rs 427.36 crore for FY21, 65.26%, 71.99%, 66.23% of its revenues being attributed to exports.

10) Valuation: The automotive components are expected to remain the largest contributor of the precision parts market over FY21-25 at ~60% with the rest of the market catering to non-automotive sectors like aerospace, defence and allied, engineering and capital goods and power. Precision engineering is expected to log a 9-11% CAGR between fiscals 2021-2026, aided by growth in the domestic auto components and export demand and indigenous manufacturing for the defence segment.