Unimech Aerospace and Manufacturing launched its much-anticipated IPO on 23 December 2024, which will remain open until December 26. The company aims to raise INR 500 crore through this offering, split evenly between a fresh issue of INR 250 crore and an offer for sale (OFS) by current shareholders. The shares are priced between INR 745 – 785 each, requiring a minimum investment of INR 14,915 for a lot of 19 shares.
Unimech Aerospace – Overview
Unimech Aerospace isn’t just another player in the market; it’s carving a niche in manufacturing for industries like aerospace, defence, energy, and semiconductors. Known for precision-engineered components, the company has shown a staggering revenue CAGR of 139.7% from FY2022 to FY2024, which speaks volumes about its growth potential.
By FY2024, Unimech’s market cap stands at about INR 3,992.27 crore, with expected revenues hitting INR 208.7 crore and an operating profit margin of 37.93%. The return on capital employed (RoCE) for the same year was an impressive 54.36%. Its P/E ratio, at 59.3x based on FY2024 earnings, positions it favourably when compared to its peers.
Unimech Aerospace Analyst Views: Mostly Bullish
The IPO has garnered positive sentiments from analysts. Swastika Investmart points out the appealing valuation and strong financial metrics, suggesting Unimech as a solid long-term investment. The company presents an appealing investment opportunity for those looking to capitalize on the growing demand in the aerospace and defence sectors. The company’s IPO is reasonably priced, making it an attractive option for investors seeking exposure to this industry segment. Geetanjali Kedia from SPTulsian Investment Advisors notes that 95% of the company’s income comes from exports to markets like the US and Germany. With a capacity utilization rate of 95%, Unimech aims to quadruple its production by FY2026, which is quite the ambition.
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Financial Performance: Numbers Talk
In FY2024, Unimech reported a revenue of INR 209 crore with a gross margin of 79% and a net profit after tax of INR 58 crore. However, there’s a slight dip in return on equity (RoE) to 10% in the first half of FY2025, attributed to recent capital raises. Looking ahead, the projected EPS for FY2026 is INR 24, translating to a forward P/E ratio of 33x, which is pretty attractive.
Peer Comparison: Where Does Unimech Stand?
Compared to competitors like MTAR Technologies and Azad Engineering, Unimech’s valuation might appear on the higher side, but its superior margins and market focus tell a different story. Analysts are recommending subscribers take note of this IPO due to its strong fundamentals and promising growth prospects.
Why Should You Care About the Unimech Aerospace IPO?
This IPO isn’t just another investment opportunity; it’s a chance to get in on the ground floor of a company with a clear path in high-demand sectors. With its robust financial history, strategic market positioning, and the backing of analysts, Unimech Aerospace could be a wise addition to any investor’s portfolio. Its expansion plans and focus on export markets bolster its case for long-term growth. If you’re looking to dive into the aerospace and defence industries, this IPO might just be the ticket.
As of November 2024, the Indian primary market has seen a total of 76 IPOs. Out of this, 58 listings have achieved positive performance. However, there were challenges as well, with 18 IPOs, experiencing negative returns. Notably, the average listing day return stands at an impressive 27.47%, underscoring the potential for significant gains in this dynamic market. For more information related to IPO GMP, SEBI IPO Approval, and Live Subscription stay tuned to IPO Central.
