When it comes to investing in IPOs, most discussions revolve around grey market premiums or short-term listing gains. However, discerning investors know that true wealth is created by understanding the underlying business model and revenue streams of the company.
In Munish Forge IPO review, we take a deep dive into how the company generates value, how it has evolved over four decades, and why its business model could prove resilient across industries. By the end of Munish Forge IPO analysis, readers will clearly understand:
- How the company has built a diversified business model around forging and casting,
- Which revenue streams are driving growth, and
- Why its integrated operations make it a long-term growth candidate.
This is not just an IPO preview – it is an inside look into the mechanics of a company that has transformed from a small parts maker into a globally recognized engineering partner.
Table of Contents
Company Overview
Founded in 1986 in Ludhiana, Punjab, Munish Forge began as a small-scale manufacturer of cycle parts. Over the years, it has steadily evolved into a leading producer of precision-engineered forged and cast products, catering to multiple industries. Today, it serves Defence, Oil & Gas, Automobile, Construction, Infrastructure, and Railways.
The company’s 40+ year legacy is not just about survival but about transformation. It is now an approved supplier to the Indian Army, producing critical defence components like battle tank track chains and bomb shells. These products undergo stringent in-house testing as well as certification at NABL-accredited laboratories, underlining the company’s focus on uncompromising quality.
Munish Forge has also diversified its portfolio with flanges, scaffolding systems, auto parts, fence posts, and steel accessories. More recently, it launched a dedicated Casting Division, strengthening its integrated manufacturing approach.
At the helm of this growth story are promoters Mr. Davinder Bhasin, Mr. Dev Arjun Bhasin, Ms. Minakshi Bhasin, along with promoter entities.
Munish Forge IPO Review: Business Model
Munish Forge has positioned itself as much more than a traditional forging company. Its business model is built on vertical integration, product diversification, and global customer reach, creating resilience and growth potential even in a competitive industry.
a) The Integrated Value Chain
The company operates an end-to-end manufacturing ecosystem where critical processes are handled in-house:
- Raw Material Sourcing – Steel sourced from reputed suppliers, ensuring quality from the start.
- Forging & Casting – Facilities capable of producing components from 300 grams to 150 kilograms, covering a wide spectrum of applications.
- Precision Machining (CNC) – In-house CNC die-making and machining centers enable tight tolerances and repeatability, which are essential in defence and automotive sectors.
- Fabrication & Welding – Advanced robotic welding improves efficiency, consistency, and safety, particularly for large assemblies.
- Surface Treatment & Painting – Automated painting plants provide uniform finishing, reducing wastage and ensuring durability.
This integration reduces external dependencies and ensures cost efficiency, quality consistency, and faster turnaround times.
b) Diversified Product Portfolio
The company is not reliant on a single product or sector. Its portfolio spans:
- Defence Products – Tank track chains, bomb shells, and couplers (critical and high-margin products).
- Oil & Gas – Flanges and pipeline components, where precision and pressure-resistance are crucial.
- Automotive – Forged parts and accessories for domestic and export markets.
- Construction & Infrastructure – Scaffolding systems and fence posts, driven by urbanization and infrastructure demand.
- Newer Segments – Casting division for SG iron tractor parts, steel castings, and railway components (brake discs, buffers), which open fresh revenue streams.
Such diversification ensures that even if one industry faces a slowdown, the company can rely on others to sustain growth.
c) Customer-Centric Model
Munish Forge business model is built around long-term relationships:
- Export markets (USA, UK, Dubai) now contribute 60%+ of revenues, making the company globally relevant.
- Domestically, it holds strong market leadership in Punjab, with ~25% of FY25 revenue from the state.
- Customer stickiness is evident – 41% of FY25 revenue came from repeat customers.
d) Strategic Advantages of the Model
- “One Stop Shop” positioning → differentiates it from smaller regional players.
- Defence approvals → create high entry barriers, shielding the company from unorganized competition.
- Technology adoption → CNC, robotic welding, automated plants improve productivity and compliance with global OEM requirements.
- Export-led growth → mitigates domestic cyclicality, gives forex earnings, and adds credibility.
👉 In summary, Munish Forge’s business model is creating a vertically integrated, diversified, and export-oriented platform that can scale sustainably.
Munish Forge IPO Analysis: Revenue Streams and Product Mix – A Deeper Look
Munish Forge has deliberately positioned itself as a multi-industry supplier, balancing cyclical industries like Oil & Gas and Construction with defence and railway, which have long-term government-backed demand. This mix has created a hedge against volatility.
a) Industry-wise Revenue Evolution
- Oil & Gas: Once the largest contributor (60.23% in FY23), its share reduced sharply to 32.64% in FY25. While absolute revenues (INR 56.09 crore) remain robust, the strategic shift ensures the company is no longer overly dependent on this cyclical sector.
- Construction & Infrastructure: Contributed 28.08% in FY25 (~INR 48.26 crore). This segment benefits from India’s ongoing infrastructure push, making it a consistent revenue generator.
- Defence: Jumped from just 1.37% in FY24 to 12.93% in FY25 (~INR 22.23 crore). Defence contracts are sticky, often multi-year, and margins are higher—making this a high-quality revenue stream.
- Steel Accessories & Scaffolding: Together contributed ~26.9% in FY25, up from barely 2–3% two years ago. These are volume-driven but essential for construction and industrial clients, ensuring steady cash flows.
- Automotive: Still a small contributor (<1%), but strategically important as it provides entry into OEM supply chains.
b) Customer Relationship Driven Sales
Revenue growth is also tied to repeat customers:
- In FY25, 82.57% of revenues came from repetitive customers, compared to just 42.74% in FY24.
- This not only improves predictability but also shows increasing customer stickiness—a critical moat in B2B manufacturing.
c) B2G, B2B, B2C, and Export Mix
The company’s revenue channels further highlight its diversified model:
- Exports: INR 103.66 crore in FY25 (60.32% of revenues).
- B2G (Defence + Tenders): INR 22.22 crore in FY25 (12.93%).
- B2B (Industrial, Infra, OEMs): INR 45.03 crore (26.20%).
- B2C: 0.55%.
d) Geographic Diversification
- India: Punjab leads domestic sales (INR 43.63 crore in FY25), followed by Tamil Nadu and Maharashtra.
- Exports: USA is the largest market (INR 57.48 crore, 33.45% of FY25 revenue), followed by the UK, Saudi Arabia, and Canada.
- Total exports contribute ~60%, offering forex income and global brand credibility.
Munish Forge IPO Analysis: Financial Performance
| Metric | FY23 | FY24 | FY25 | Trend |
|---|---|---|---|---|
| Revenue from Operations | 160.13 | 159.89 | 175.45 | 🔼 Moderate growth after stable FY24 |
| EBITDA | 9.14 | 11.44 | 24.37 | 🔼 2.7x growth in 2 years |
| EBITDA Margin (%) | 5.71 | 7.15 | 13.89 | 🔼 Continuous margin expansion |
| PAT | 1.97 | 4.39 | 14.30 | 🔼 7.2x jump in 2 years |
| PAT Margin (%) | 1.23 | 2.75 | 8.15 | 🔼 Strong profitability |
| RoE (%) | 5.47 | 10.83 | 21.22 | 🔼 Efficiency doubled |
| RoCE (%) | 7.06 | 9.89 | 16.44 | 🔼 Improved capital efficiency |
| Debt/Equity | 1.40 | 1.16 | 0.89 | 🔽 Deleveraging successfully |
- Stable Revenue, Rising Profits – Topline growth is modest, but profitability has surged due to better product mix and operational efficiency.
- Margin Expansion – EBITDA margin more than doubled from FY23 to FY25, a sign of stronger pricing power.
- Efficient Capital Use – RoE crossed 20% in FY25, showing high returns for shareholders.
- Deleveraging – Debt/Equity improved significantly, highlighting balance sheet discipline.
Competitive Strengths
Munish Forge’s journey from a cycle parts maker to a globally recognized forging and casting company is powered by distinct strengths:
- Experienced Promoters & Management – With 40+ years of expertise in the forging industry, the Bhasin family and professional leadership team have successfully steered the company into defence, exports, and now the railway sector.
- Integrated Manufacturing Facility – A “One Stop Shop” model with in-house forging, CNC machining, robotic welding, fabrication, die-making, painting, and testing facilities ensures efficiency, speed, and cost advantage.
- Global Export Footprint – With over 60% of revenue from exports to the USA, UK, and Middle East, the company has strong international brand recognition and reduced dependence on domestic markets.
- Diversified Product Portfolio – From tank track chains to scaffolding, flanges, defence shells, and now railways, Munish Forge operates across multiple industries, balancing risks and opportunities.
Business Strategies
Munish Forge has outlined clear strategies to sustain and accelerate growth:
- Efficiency & Sustainability
- Adoption of induction furnaces has reduced material burning loss from ~2% to just 0.5%, improving yields and eco-efficiency.
- Integration of solar power panels reduces carbon footprint and energy costs.
- Continuous tooling upgrades enhance product quality and reduce rejection rates.
- Sectoral & Geographical Diversification
- Strategic entry into railways with buffer and brake disc manufacturing.
- Deepening presence in defence contracts, a long-term growth sector supported by India’s indigenization drive.
- Expanding customer base globally across the USA, Europe, and Middle East markets.
- Customer-Centric Growth
- Leveraging exhibitions like Bauma Munich and auto shows in India for market visibility.
- Strengthening long-term client relationships, reflected in 82.57% revenue from repeat customers in FY25.
Conclusion
Munish Forge IPO review highlights that the company is a legacy forging company transforming into a modern engineering powerhouse. The company’s financials show a dramatic improvement in profitability, margins, and returns over the last three years. Its global footprint, defence approvals, and planned railway foray provide strong growth visibility.
For investors, this IPO offers a chance to participate in:
- A company with 40+ years of industry credibility.
- Proven export-driven model (over 60% international sales).
- Diversified revenue streams across defence, oil & gas, infrastructure, and railways.
- Strengthening balance sheet with improving RoE and RoCE.
While competition and cyclical demand are natural risks in the forging sector, Munish Forge’s continuous innovation, certifications, and customer stickiness help mitigate these concerns.
👉 Overall, Munish Forge IPO appears to be a compelling opportunity for investors seeking exposure to India’s manufacturing, defence, and infrastructure growth story.
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