Unimech Aerospace IPO: SEBI approval and key highlights from DRHP

Unimech Aerospace and Manufacturing, a provider of high-precision engineering solutions, is all set to go public. After receiving approval from the SEBI or Securities and Exchange Board of India, the company is launching an IPO or the initial public offering to raise ₹500 crore. 

Investors looking to invest in stocks are closely following the developments, as the IPO could present a valuable opportunity. Unimech Aerospace filed its papers with SEBI on August 19, 2024, and is now preparing for the listing.

Key highlights of Unimech Aerospace IPO

Here are the important details investors need to know before deciding to invest in stocks.

• IPO structure: The Unimech Aerospace IPO comprises two parts: a fresh issue of ₹250 crore and an offer for sale (OFS) of ₹250 crore by its promoters and promoter group. It also includes a reserved portion for eligible employees.
• Offer details: The offer for sale includes shares worth ₹45 crore from Ramakrishna Kamojhala, Mani P, and Rajanikanth Balaraman, ₹30 crore from Preetham S.V., and ₹85 crore from Rasmi Anil Kumar. 
• Pricing and bidding: The final price band and minimum bid lot will be determined in consultation with the book-running lead managers (BRLMs).

IPO proceeds utilisation

The funds from the new issue will be used for several purposes, including capital expenditures, loan repayment, and general corporate expenses. The company plans to allocate ₹32.59 crore for purchasing machinery and equipment, ₹25.28 crore for working capital needs, and ₹43.94 crore for capital expenditures in its subsidiary. Additionally, ₹44.71 crore will go towards subsidiary working capital, while ₹40 crore will be used for repaying borrowings.

Strong financial performance

Unimech Aerospace has demonstrated strong financial growth. In FY24, its revenue surged by 121.7% to ₹208.77 crore, up from ₹94.17 crore in FY23. This growth was driven by increased capacity and a higher volume of purchase orders. Profit after tax also saw a substantial rise, growing by 154.8% to ₹58.13 crore in FY24, compared to ₹22.81 crore in the previous year.

About Unimech Aerospace

Founded in 2016, Unimech Aerospace specialises in high-end manufacturing, providing services such as machining, fabrication, and assembly. The company is a leading player in producing complex tooling, mechanical assemblies, and precision components primarily used in the aerospace industry. Investors looking to invest in stocks in this high-demand sector will want to watch Unimech’s IPO closely.

Key takeaways

1. Unimech Aerospace is offering a ₹500 crore IPO, with equal portions for a fresh issue and an OFS.
2. Funds will be utilised for capital expenditure, working capital, and repaying loans.
3. The company posted impressive financial growth, with a 121.7% revenue increase and a 154.8% rise in profit after tax.
4. Unimech Aerospace is a major player in aerospace manufacturing, offering opportunities for those looking to invest in stocks in a growing industry.