Carraro India Limited IPO (Carraro India IPO) Detail Review –
Carraro India Limited IPO (Carraro India IPO) is set to open for subscription from 20th Dec 2024 to 24th Dec 2024. In this article we will analyze the financials , strengths and weaknesses of the Carraro India Limited IPO (Carraro India IPO). Keep scrolling below to read more!
Carraro India Limited IPO (Carraro India IPO) Overview –
Established in 1997, Carraro India Ltd is engaging in manufacturing components ranging from the smallest gear to complete tractor manufacturing.
The company designs, manufactures, and sells transmission systems (axles, transmissions, and drives) primarily for agricultural and construction equipment for off-highway vehicles. It also offers a wide range of gears for various sectors, including automotive, trucks agricultural, and construction vehicles.
The company owns and operates two manufacturing plants in Pune, Maharashtra, India. The driveline manufacturing plant occupies a plot area of approximately 84,000 square meters, while the gear manufacturing plant covers an area of approximately 78,000 square meters.
The driveline plant has technologies including casting, machining, assembly, prototyping, testing, and painting. The gears plant features machining and heat treatment technologies such as carburizing, induction, hardening, and nitriding.
Products:
- Agricultural tractors: They manufacture axles and transmission systems for agricultural tractors which include special requirements on technical specifications, use cases, and mechanical and structural design.
- Construction vehicles: They manufacture gears and transmission systems for backhoe loaders, compact wheel loaders, telehandlers, cranes, forklifts, aerial working platforms, etc.
- Others: They manufacture a diverse range of products beyond their core offerings of axles and transmissions for agricultural and construction equipment, which include additional products such as gears, shafts, and ring gears for industrial and automotive vehicles.
The company has developed expertise in the agricultural tractor and construction vehicle industry in India and has established a network of 220 suppliers across eight states in India, along with 58 suppliers internationally.
As of September 30, 2024, the company’s local quality and after-sales team consisted of 87 full-time employees and 53 contractual temporary employees.
Competitive Strengths:
- Tier 1 suppliers of transmission systems and a key supplier of axles in India’s agricultural tractor and construction vehicle industries with competitive moats for mission-critical and complex driveline components.
- Customer-centric offering of customized solutions to a longstanding OEM customer base
- Longstanding relationships with marquee local and international supplier base
- Strong, in-house R&D capabilities with proprietary IP rights to facilitate innovation of future-ready products
- Technologically advanced manufacturing plants with large production capacities and in-house gear production capabilities
Carraro India Limited IPO (Carraro India IPO) Synopsis –
Carraro India Limited IPO (Carraro India IPO) is set to be open for subscription from 20th Dec 2024 to 24th Dec 2024, offering offer for sale of 1.78 crore shares aggregating to Rs 1,250.00 crores. This NSE,BSE IPO follows a Book Built Issue IPO with tentative listing date fixed as Monday, December 30, 2024.
The total issue size of this IPO amounts to Rs. 1,250.00 Crores. The company has allocated shares 35% to retail investors, 50% to institutional and 15% to non institutional investors.
| Particulars | Details |
| Opening Date | 20th Dec 2024 |
| Closing Date | 24th Dec 2024 |
| Lot Size | 21 Shares |
| Face Value | Rs 10 |
| IPO Size | Rs. 1,250.00 Cr |
| Fresh Issue | — |
| IPO Price Range | Rs. 668 – 704 |
| Min. Investment | Rs. 14,784 |
| Offer for Sale (OFS) | Rs. 1,250.00 Cr |
| Employee Discount | — |
| Basis of Allotment | 26th Dec 2024 |
| Refunds | 27th Dec 2024 |
| Listing Date | 30th Dec 2024 |
| DRHP Draft Prospectus: | Click Here |
| RHP Draft Prospectus: | Click Here |
Carraro India Limited IPO (Carraro India IPO) Market Lot –
Carraro India Limited IPO (Carraro India IPO) minimum market lot is 21 shares with ₹14,784 application amount. The retail investors can apply up to 13 lots with 273 shares or ₹1,92,192 amount.
| Application | Lot Size | Shares | Amount |
| Retail Minimum | 1 | 21 | ₹14,784 |
| Retail Maximum | 13 | 273 | ₹1,92,192 |
| S-HNI Minimum | 14 | 294 | ₹2,06,976 |
| S-HNI Maximum | 67 | 1,407 | ₹9,90,528 |
| B-HNI Minimum | 68 | 1,428 | ₹10,05,312 |
Carraro India Limited IPO (Carraro India IPO) Book Running Lead Managers –
Axis Bank Limited
BNP Paribas
Nuvama Wealth Management Limited.
Carraro India Limited IPO (Carraro India IPO) Promoters –
Tomaso Carraro
Enrico Carraro
Carraro S.p.A
Carraro International S.E.
Pre-Issue Promoter Shareholding | 100.00% |
Post-Issue Promoter Shareholding | 68.77% |
Carraro India Limited IPO (Carraro India IPO) Registrar to the offer –
The registrar for the Carraro India Limited IPO (Carraro India IPO) is Link Intime India Pvt Ltd. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.
The Objective Of The Issue –
The promoter-selling shareholder will get all offer proceeds after deducting offer-related costs and applicable taxes, which will be the promoter-selling shareholder’s responsibility. The company won’t get any proceeds from the offer.
Key Performance Indicator –
The market capitalization of Carraro India Limited is Rs 4,002.35 Cr.
KPI as of March 31, 2024.
| KPI | Values |
| ROE: | 17.69% |
| ROCE: | 19.35% |
| EBITDA Margin: | 8.30% |
| PAT Margin: | 3.50% |
| Debt to equity ratio: | 0.58 |
| Earning Per Share (EPS): | ₹11.00 (Basic) |
| Price/Earning P/E Ratio: | N/A |
| Return on Net Worth (RoNW): | 16.92% |
| Net Asset Value (NAV): | ₹65.05 |
Financial Status –
Carraro India Limited’s revenue increased by 4% and profit after tax (PAT) rose by 29% between the financial year ending with March 31, 2024 and March 31, 2023.
Below is the synopsis of the company’s financial data for the financial year that concluded on 30 Sep 2024.
The company’s total assets are Rs. 1,093.41 crore.
The company’s total revenue is Rs. 922.74 crore.
The company’s PAT is Rs. 49.73 crore.
The company’s net worth is Rs. 419.44 crore
| Period Ended | 30 Sep 2024 | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 | ||||||||||||||||||||||||||||||||||||
| Total Assets | 1,093.41 | 1,072.89 | 1,072.39 | 1,012.44 | ||||||||||||||||||||||||||||||||||||
| Revenue from operations | 922.74 | 1,806.55 | 1,733.3 | 1,520.05 | ||||||||||||||||||||||||||||||||||||
| Profit After Tax | 49.73 | 62.56 | 48.46 | 22.43 | ||||||||||||||||||||||||||||||||||||
| Net Worth | 419.44 | 369.82 | 337.38 | 292.49 | ||||||||||||||||||||||||||||||||||||
| Reserves and Surplus | ||||||||||||||||||||||||||||||||||||||||
| Total Borrowing | 195.78 | 212.55 | 188.33 | 178.14 | ||||||||||||||||||||||||||||||||||||
| Amount in ₹ Crore | ||||||||||||||||||||||||||||||||||||||||
Evaluation of P/E Ratio :
Considering the FY ended 31 Mar 2024 with an EPS of Rs.11 from the last year, the resulting P/E ratio is 64x.
Considering the weighted EPS of Rs.9 for the last three years, the P/E ratio is 78.22x.
Comparative Analysis with Listed Peers
The average P/E Ratio of the industry is 78.22x.
In simple words, the P/E ratio of this IPO (40.4x), compared with the industry’s average P/E of 78.22x, has an undervaluation (on a P/E ratio basis only). Hence the price of the Share seems fully priced for the investors when considered based on the average P/E ratio of the industry.
Peers of Carraro India Limited IPO (Carraro India IPO) –
Carraro India Limited peer comparison with similar listed entities.
| Company | EPS | PE Ratio | RoNW % | NAV | Income |
| Escorts Kubota Limited | 96.80 | 43.21 | 11.43% | 830.45 | – Cr. |
| Schaeffler India Limited | 57.5 | 74.22 | 18.71% | 307.44 | – Cr. |
| Sona BLW Precision Forgings Limited | 8.83 | 76.93 | 18.49% | 47.75 | – Cr. |
| Ramakrishna Forgings Limited | 20.27 | 42.82 | 12.72% | 148.48 | – Cr. |
| Happy Forgings Limited | 26.78 | 47.08 | 15.07% | 171.17 | – Cr. |
| Action Construction Equipment Limited | 27.56 | 50.56 | 26.69% | 307.44 | – Cr. |
Dividend Policy –
The company has paid a dividend of Rs.92.59 per Share in FY23.
Carraro India Limited IPO (Carraro India IPO) Strengths –
These suppliers are reputed Tier 1 Transmission System suppliers and also have a role as axle suppliers in India’s agricultural tractor and construction vehicle industries. Their mission-critical driveline components present wide competitive moats and are extremely complex.
A customized offering for customers to long-term OEM customers.
Long associations with a premium local and international supplier base.
Strong co-generated R&D capabilities backed by proprietary IP rights to design new-to-market products.
High-tech manufacturing plants with vast production capabilities and in-house gear production facilities.
Complete Tier 1 Transmission System supplies are said to be axle supplier in India for agricultural tractor and construction vehicle industries. Such mission-critical and complex driveline components create a wide competitive gate.
Customer-specific offerings of customized solutions to a long-staying OEM customer base.
Long-standing relationships with signature local and international supplier base Strong in-house R&D capabilities with proprietary IP rights for developing products of the future.
Technologically advanced manufacturing plants with huge production capacities and in-house gear production capacities.
Carraro India Limited IPO (Carraro India IPO) Weakness –
Being overly reliant on the agricultural and construction sectors puts the business at industry risk.
Geographical presence beyond India is limited which could restrict the propensity for global market penetration.
Few marquee customers are highly relied upon, hence increasing concentration risk.
Costs incurred from advanced technology maintenance as much as R&D capabilities are considerable.
Global players compete with the market of key segments in terms of reach of the company’s market.
Carraro India Limited IPO (Carraro India IPO) Status –
Carraro India Limited IPO (Carraro India IPO) allotment status will be available on the Link Intime India Pvt Ltd website. Click on this link to get allotment status.
Disclaimer –
- Don’t decide to subscribe to an IPO just based on the initial price, as it can change before the listing. Subscribe only after considering fundamentals of the companies.
Conclusion –
Hope the details presented in this blog will assist you in learning about the financial performance of the company. Before making an investment in the company’s upcoming initial public offering (IPO), thoroughly research the company, its finances, business prospects, and market trends.
Also, investors should consult their financial advisor, conduct further due diligence, analyze industry trends and the competitive landscape, and consider risk factors before making an investment decision.
For all such latest information on upcoming IPOs, keep visiting our website.
