The initial public offering of Harsha Engineers International will open for subscription tomorrow i.e., Wednesday, September 14 and the issue will close on September 16.
The IPO consists of a fresh issue of equity shares aggregating to ₹455 crore, and an offer-for-sale (OFS) of up to ₹300 crore by existing shareholders.
Company Overview
Harsha Engineers International was incorporated in 2010. It is the largest manufacturer of precision bearing cages, in terms of revenue in the organised sector in India. The company is a part of the Harsha Group.
It supplies its products to customers in over 25 countries covering five continents. The business comprises two segments — engineering business and solar EPC business.
Listing Details
The company has fixed the IPO price band at ₹314-330 per share for the ₹755 crore initial share offer.
50% of the issue size has been reserved for qualified institutional investors, 35% for retail investors and the remaining 15% for non-institutional investors.
Investors can bid for a minimum of 45 equity shares and in multiples of 45 equity shares thereafter.
IPO Timeline
| Event | Indicative Date |
| IPO opening date | September 14, 2022 |
| IPO closing date | September 16, 2022 |
| Basis of allotment | September 21, 2022 |
| Initiation of refunds | September 22, 2022 |
| Credit of shares to demat | September 23, 2022 |
| IPO listing date | September 26, 2022 |
Objective of Issue
The net proceeds from the fresh issue will be utilised for debt payment, funding working capital requirements towards purchase of machinery, infrastructure repairs and renovation of the existing production facilities and for general corporate purposes.
Company Financials
Here is a quick look at the financial performance of Harsha Engineers over the last three years:
Particulars (Amount in ₹ lakhs) | 31 March 2020 | 31 March 2021 | 31 March 2022 |
| Total assets | 973.24 | 981.07 | 1158.25 |
| Total revenue | 899.5 | 876.73 | 1339 |
| Profit after tax | 21.91 | 45.44 | 91.94 |
| Net worth | 378.02 | 433.22 | 527.9 |
Company Strengths
The company is a comprehensive solution provider offering a diversified suite of precision engineering products across geographies and end-user industries. It also has long-standing relationships with leading clientele.
It has expertise in tooling, design development and automation. The company has a consistent track record of growth and financial performance. Also has a strong, experienced and dedicated senior management team and qualified workforce.
Risks Involved
The company has an unrelated business of solar EPC which has been merged with the company as a part of reorganisation. Any incremental investment in the solar EPC business may dilute the blended margin of the company.
The company’s revenue is highly dependent on a few large customers. Any adverse development or significant reduction in business from these customers may adversely affect Harsha’s financial condition.
As per market observers, Harsha Engineers shares are commanding a premium (GMP) of ₹212 in the grey market today.
