Pritika Engineering Components
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 25 Nov 2022 – 30 Nov 2022
- Listing date
- 08 Dec 2022
- Face value
- ₹10 per share
- Issue price
- ₹29 per share
- Lot size
- 4,000 shares
- Total issue size
- ₹9.42 Cr
- Market cap at offer price
- ₹31.56 Cr
- Promoter holding
- 100.00% → 70.15% pre-issue → post-issue
- ISIN
- INE0MJQ01020
- Registrar
- MUFG Intime India Pvt.Ltd.
- Lead managers
- GYR Capital Advisors Pvt.Ltd.
- Registered office
- Plot No.C-94, Phase-VII Industrial Focal Point, S.A.S Nagar, Punjab
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Market maker | 1,64,000 | — | — |
Application size
Minimum 4,000 shares per lot, in multiples, at ₹29
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 4,000 | ₹1,16,000 |
| S-HNI (min) | 2 | 8,000 | ₹2,32,000 |
| S-HNI (max) | 8 | 32,000 | ₹9,28,000 |
| B-HNI (min) | 9 | 36,000 | ₹10,44,000 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Valuation and performance
Valuation at offer price
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 7.15 | — |
| P/E (×) | 4.06 | — |
| Market cap | — | ₹31.56 Cr |
Key performance indicators
- Return on net worth
- 33.05%
- ROCE
- 15.81%
- Debt / equity
- 1.02
- PAT margin
- 9.52%
- NAV per share
- ₹22
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Pritika Engineering Components
Pritika Engineering Components Limited, incorporated in February 2018 and converted to a public company in April 2022, is engaged in manufacturing precision machined components for the automotive industry, particularly for tractors, trucks, and other commercial vehicles. The company supplies directly to Original Equipment Manufacturers (OEMs) and through its promoter company Pritika Auto Industries Limited and group company Pritika Industries Limited. The company manufactures various components including End Covers, Brake Covers, Differential Cases, Hydraulic Lift Covers, Front Wheel Hubs, Fly Wheel Housing, Rear Axle Casings, and Brake Housing. With an installed capacity of 12,000 MT (as of FY22) and a vision to become the first choice among OEMs for machined castings, the company aims to produce 35,000 MT of machined castings by 2025. In FY22, the company manufactured 6,619 MT with a capacity utilization of 55%.
Company Analysis
from RHPPritika Engineering Components Limited manufactures precision machined automotive components primarily for tractors, trucks, and commercial vehicles through its subsidiary and group companies.
Pritika Engineering Components Limited, incorporated in February 2018 and converted to a public company in April 2022, is engaged in manufacturing precision machined components for the automotive industry, particularly for tractors, trucks, and other commercial vehicles. The company supplies directly to Original Equipment Manufacturers (OEMs) and through its promoter company Pritika Auto Industries Limited and group company Pritika Industries Limited. The company manufactures various components including End Covers, Brake Covers, Differential Cases, Hydraulic Lift Covers, Front Wheel Hubs, Fly Wheel Housing, Rear Axle Casings, and Brake Housing. With an installed capacity of 12,000 MT (as of FY22) and a vision to become the first choice among OEMs for machined castings, the company aims to produce 35,000 MT of machined castings by 2025. In FY22, the company manufactured 6,619 MT with a capacity utilization of 55%.
Objects of the Issue
- Investment in relation to the new unit set up by our Wholly Owned subsidiary, Meeta Castings Limited (MCL) ₹700.00 lakhs (92.48% of Net Proceeds) p.21
- General Corporate Purpose ₹56.92 lakhs (7.52% of Net Proceeds) p.21
- Investment in relation to the new unit set up by our wholly owned subsidiary, Meeta Castings Limited (MCL) ₹700.00 lacs p.68
- General Corporate Purposes ₹56.92 lacs p.68
- Not explicitly stated in this section
Issue Structure
- Total Issue
- ₹941.92 lakhs
- Fresh Issue
- 32,48,000 equity shares of face value ₹10 each at ₹29 per share aggregating ₹941.92 lakhs
- Offer for Sale
- Nil - entire issue constitutes fresh issue
- Price Band
- Fixed at ₹29 per equity share
- Lot Size
- 4,000 equity shares and in multiples of 4,000 thereafter; subject to a minimum allotment of 4,000 equity shares
- Face Value
- ₹10 per equity share
Business Model
The company earns revenue through manufacturing and supplying precision machined automotive components to OEMs. It operates on a made-to-order basis with customers placing purchase orders periodically. The company does not have long-term supply agreements with firm commitments but relies on schedules provided by customers. Revenue is generated through direct supply to OEMs and through its promoter and group companies. The business model involves significant capital investment in manufacturing facilities and relies on maintaining customer relationships and quality standards to secure orders.
Business Segments
SWOT Analysis
- • Listed on NSE EMERGE platform with regulatory approval(p.2)
- • Strong holding company backing and established group presence(p.20)
- • Focused niche market in automotive components for tractors and commercial vehicles(p.20)
- • Established customer base with long-term relationships(p.30)
- • Quality certifications and accreditations from recognized agencies(p.95)
- • Experienced and professional management team with automotive industry expertise(p.95)
- • Wide product range and customized product segments(p.95)
- • Inherited legacy business process and management from group companies(p.96)
- • Strong and experienced R&D team for customized product development(p.96)
- • Significant improvement in financial performance and EBITDA margins(p.97)
- • Substantial unutilized production capacity indicating growth potential(p.95)
- • Experienced management with deep industry expertise(p.135)
- • Established manufacturing infrastructure and capital assets(p.149)
- • Profitable operations with growing revenue trajectory(p.150)
- • Support from established promoter and holding company(p.135)
- • Established production capacity and machinery base(p.183)
- • Low unutilized capacity indicating scalability(p.212)
- • Strong revenue growth trajectory(p.212)
- • Healthy profit margins(p.212)
- • Secured borrowing base with institutional backing(p.212)
- • Compliance certifications in place(p.236)
- • Rented registered office with expiry risk(p.26)
- • Extreme customer concentration with top 3 accounting for ~99.7% of revenue(p.30)
- • Dependence on few suppliers for raw materials(p.35)
- • High financial indebtedness with secured borrowings(p.36)
- • Promoter personal guarantees as security for loans(p.30)
- • Litigation against promoters(p.29)
- • Project not yet approved by appraisal agency(p.28)
- • Heavy reliance on original equipment manufacturers with major customer concentration(p.94)
- • Elevated and persistent long-term debt levels relative to equity(p.95)
- • Majority shareholding concentration in promoter with limited public holding(p.94)
- • Operating primarily in cyclical automotive and tractor industry segments(p.94)
- • High financial leverage with debt exceeding equity(p.166)
- • Dependency on related party transactions and supplier concentration(p.164)
- • Significant dependence on tooling advances from related parties(p.161)
- • No formal dividend policy and no dividend history(p.143)
- • High financial leverage(p.228)
- • Low debt service coverage ratio(p.203)
- • Pending litigation involving directors and company(p.231)
- • High dependence on related party sales(p.217)
- • Significant inventory concentration(p.183)
- • Negative operating cash flows in recent period(p.221)
- • Rapid expansion in Indian auto-components industry(p.20)
- • Government support through Automotive Mission Plan(p.20)
- • Strong FDI inflows into Indian automotive sector(p.20)
- • Expansion of manufacturing capacity through MCL subsidiary(p.20)
- • Growing domestic market with increased purchasing power and infrastructure development(p.20)
- • Expansion into advanced lost foam casting technology for higher margins and capabilities(p.69)
- • Setup of new manufacturing unit with 1000MT per month capacity through subsidiary(p.68)
- • Strong projected growth in Indian automotive components industry and exports(p.90)
- • Growing Indian tractor and commercial vehicle production driving demand(p.88)
- • Expansion of customer base beyond existing OEM relationships(p.96)
- • Build in-house R&D team to enhance product development efficiency and timeline(p.96)
- • Strategic investment in new subsidiary for foundry operations expansion(p.142)
- • Growth in tractor and automobile components manufacturing sector(p.138)
- • Capacity expansion through capital work in progress(p.149)
- • Expansion into new geographic markets and customer segments(p.213)
- • Significant capacity utilization growth potential(p.212)
- • Post-pandemic demand recovery in tractor and automobile sector(p.214)
- • Diversification of customer base beyond group companies(p.212)
- • Capital market access through IPO for expansion funding(p.240)
- • Absence of long-term supply agreements makes revenue unpredictable(p.27)
- • Customer price pressure eroding margins(p.28)
- • Raw material price volatility linked to commodities(p.35)
- • Intense competition from global and local manufacturers(p.36)
- • COVID-19 pandemic impact and future waves risk(p.39)
- • Regulatory and policy changes affecting operations(p.38)
- • Economic instability in India and globally affecting demand(p.39)
- • Political instability and security threats in India(p.40)
- • Highly fragmented and competitive industry with low entry barriers(p.104)
- • Cyclicality and COVID-19 related disruptions in automotive and tractor demand(p.104)
- • Dependence on raw material costs and supply chain disruptions(p.107)
- • Regulatory compliance requirements and environmental pollution control obligations(p.112)
- • Exposure to foreign exchange and currency fluctuation risks(p.70)
- • Monsoon and agricultural commodity price dependency affecting tractor industry demand(p.85)
- • Exposure to foreign exchange and commodity price volatility(p.162)
- • Dependence on discretionary spending by automobile and tractor manufacturers(p.162)
- • Regulatory and compliance risks in manufacturing sector(p.26)
- • Competition from established players and new entrants in auto components sector(p.162)
- • Dependence on tractor and automobile industry cyclicality(p.213)
- • Intense competitive pressure from organized and unorganized sectors(p.222)
- • Vulnerability to global supply chain disruptions and logistics cost volatility(p.213)
- • External regulatory and policy changes(p.213)
- • Global economic volatility and geopolitical risks(p.213)
- • Raw material price fluctuation and input cost pressures(p.219)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Pritika Auto Industries Limited | Promoter | 100% | 70.15% |
| Raminder Singh Nibber | Natural Person Controlling Promoter | Negligible (2 shares) | — |
| Harpreet Singh Nibber | Natural Person Controlling Promoter | Negligible (1 share) | — |
| Pritika Auto Industries Limited | Promoter | 100% | — |
| Pritika Auto Industries Limited | Promoter | 99.99% | — |
| Harpreet Singh Nibber | Natural person in control of promoter | — | — |
| Raminder Singh Nibber | Natural person in control of promoter | — | — |
| Pritika Auto Industries Limited | Promoter/Holding Company | 100% | — |
| Raminder Singh Nibber | Promoter | — | — |
| Pritha Auto Industries Limited (through Harpreet Singh Nibber) | Promoter Group | — | — |
Leadership
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.