Panchkula-headquartered Emmforce Autotech Limited files DRHP with BSE SME
by Prashant Kapadia/NHN
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IPO comprises a fresh issue of 55,00,000 equity shares with a face value of Rs. 10 each
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The company manufactures niche automotive drivetrain parts and exports most of the products worldwide
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Operates a state-of-the-art manufacturing facility spread over 1,50,000 Sq Ft at Baddi, Himachal Pradesh
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Emmforce intends to invest the proceeds from IPO in its subsidiary EMSPL for setting up a manufacturing unit at Export Promotion Industrial Park, Baddi, Himachal Pradesh
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Beeline Capital Advisors Private Limited has been appointed as the Book Running Lead Manager, and Link Intime India Private Limited is the Registrar to the Issue
December 28, 2023: Emmforce Autotech Limited (The company), a leading automotive components manufacturer in India, announced the filing of its Draft Red Herring Prospectus (DRHP) with the BSE SME. The offering comprises a fresh issuance of 55,00,000 equity shares, each with a face value of Rs. 10. Beeline Capital Advisors Private Limited has been appointed as the Book Running Lead Manager, and Link Intime India Private Limited is the Registrar.
The Panchkula-headquartered company manufactures niche automotive drivetrain parts and exports most of the products to six continents, primarily to North America and Asia. Emmforce manufactures a wide range of automotive drivetrain parts such as Differential Housings, Differential Lockers, Differential Covers, 4WD Locking Hubs, Spindles, Axles and Shafts, Gear Shifters, Yokes, Differential Spools, Differential Tools and various differential forged / cast parts primarily for 4-wheel Drive and performance racing vehicles. It operates a manufacturing plant spread across 1,50,000 Sq Ft at Baddi in Himachal Pradesh.
According to the DRHP, the company intends to invest Rs. 10 crore from the IPO proceeds in its recently acquired subsidiary company – Emmforce Mobility Solutions Private Limited (EMSPL), for setting up a new manufacturing plant at Jharmajri, Baddi, Himachal Pradesh, in the form of equity or debt to meet the requirement of working capital and margin money for term loan of subsidiary company and Rs. 27 crore to meet Emmforce’s working capital requirements and for general corporate purposes.
EMSPL is going to manufacture Blades used in Rotavators / Other agriculture implements and Steel Forgings for the automotive / engineering industries and commercial production at its upcoming manufacturing unit at Jharmajri, Baddi in Himachal Pradesh is expected to commence in February 2024.
Commenting on the company’s IPO plans, Mr. Ashok Mehta, Chairman & Managing Director, Emmforce Autotech Limited, said, “Being a one-stop solution for a variety of drivetrain parts makes us a preferred supplier to our customers, enabling them to save big on logistics and management bandwidth. We are planning to invest proceeds from IPO in our subsidiary company EMSPL to expand its manufacturing capabilities and cater to untapped territories, including Europe, South America, Africa, the Middle East, Asia Pacific and India. Apart from supplying 4-wheel drive and performance racing vehicles, we are looking to broaden our product line to serve unexplored sectors like Agriculture, Off Highway, EV, Railways and Defence.”
Emmforce Autotech is promoted by the first-generation automotive industry entrepreneur Mr. Ashok Mehta. With over 32 years of rich experience in manufacturing automotive differential and drivetrain parts, Mr. Mehta has been instrumental in determining the company’s vision and growth strategies. Though a chartered accountant by education, he authored the world’s first book ever written on axle shafts titled “The World Around Axle Shafts”.
The company recorded a total revenue of Rs. 48.75 crore in FY2022-23 and Rs. 71.38 crore in FY2021-22. In FY2022-23, the company made a profit (PAT) of Rs. 4.38 crore and Rs. 7.32 crore in FY2021-22.
India’s auto components industry’s market share has grown dramatically, led by rising demand for automobiles by the growing middle class and exports globally. According to IBEF, the Indian automobile component industry turnover stood at Rs. 5.6 lakh crore (US$ 69.7 billion) between 2022-23, the industry had revenue growth of 32.8% as compared to 2021-22. Domestic OEM supplies contributed ~66% to the industry’s turnover, followed by domestic aftermarket (~12%) and exports (~22.3%), in FY23.
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