Blackstone-promoted Sona BLW Precision Forgings Limited has received capital markets regulator Sebi’s go-ahead to float its maiden public offer. The global automotive supplier had filed its draft prospectus in February this year. Sona BLW Precision Forgings IPO comprises of a fund raise via a fresh issuance of shares amounting to INR300 crore (INR3 billion) and INR5,700 crore through an offer for sale (OFS) by shareholder Singapore VII Topco III Pte Ltd., an affiliate of The Blackstone Group Inc.
The Gurugram headquartered company is one of India’s leading automotive technology companies, designing, manufacturing and supplying highly engineered, mission critical automotive systems and components such as differential assemblies, differential gears, conventional and micro-hybrid starter motors, BSG systems, EV traction motors and motor control units to automotive OEMs across US, Europe, India and China, for both electrified and non-electrified powertrain segments and are not dependent on a single product, vehicle segment, customer or geography.
It also stands to be one of the two largest exporters of starter motors from India besides being the largest manufacturer of differential gears for Passenger Vehicles, Commercial Vehicles and Tractors in India. Some of its key OEM customers include a global OEM of EVs, a North American OEM of Passenger Vehicles and Commercial Vehicles, Ashok Leyland, Daimler, Escorts, Mahindra & Mahindra, Mahindra Electric, Maruti Suzuki, Renault Nissan, Volvo and Volvo Eicher.
Sona BLW Precision Forgings IPO: On a strong footing
Between FY16-20, the company has seen its total operating income grow at the CAGR of 10.9%. In FY 20, as compared to the top 10 publicly listed auto component manufacturers in India by market capitalization, Sona BLW Precision Forgings has the highest operating EBITA margin, PAT margin, ROCE and ROE.
According to the draft prospectus filed for Sona BLW Precision Forgings IPO, the company reported comprehensive income of INR154.3 crore on total revenues of INR1,029.6 crore for the nine months ended 31 December 2020.
Kotak Mahindra Capital Company Ltd, Credit Suisse Securities Pvt Ltd, J.P. Morgan India Pvt Ltd, JM Financial Ltd and Nomura Financial Advisory and Securities Pvt Ltd are the BRLMS to the Issue.
