Belrise Industries Files Draft Papers for Rs 2150 Crore IPO

Pune-based Belrise Industries, a positioned name in the automotive components industry, is setting itself up for an IPO worth Rs.2,150 crore. The company recently filed its draft papers with SEBI, laying out plans for a fresh issue of equity shares. With no offer-for-sale (OFS) component, the entire proceeds will directly support the company’s growth going ahead.

Where will the Funds go?

Belrise is looking to use Rs.1,618 crore from the IPO to cut down on its debt, which currently stands at Rs.2,463 crore (as of June 2024). This would help cut its borrowings by 62.52%, improving its debt-equity ratio significantly. The company is also considering raising Rs.430 crore through a pre-IPO placement, which could reduce the IPO size accordingly. Any leftover funds will go towards general corporate purposes.

What Does Belrise Do?

Founded in 1996, Belrise is known for precision sheet metal pressing and fabrication, essential for building vehicle bodies and subsystems. The company serves automotive giants like Bajaj Auto, Hero MotoCorp, Honda Motorcycle, and even Jaguar Land Rover. It’s among the top three in India’s two-wheeler metal components market, holding a 24% share.

With 15 manufacturing facilities spread across eight states, Belrise operates both domestically and internationally, exporting to countries like Austria, Slovakia, the UK, Japan, and Thailand.

The Numbers 

Financially, Belrise has been doing well. In FY24, its revenue grew 13.7% to Rs.7,484 crore, with exports making up 76% of sales. However, profit slipped slightly to Rs.310.9 crore, down 0.9% from the previous year, thanks to weaker operating margins. For Q1FY25, it reported a profit of Rs.71.6 crore on revenue of Rs.1,781 crore.

Conclusion: Belrise plans to use this IPO to strengthen its finances and focus on growth. With Axis Capital, HSBC, Jefferies India, and SBI Capital as lead managers, it’s all set to hit the market soon.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.