Gala Precision Engineering has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds through the initial public offering (IPO) route.
Mumbai-based precision components maker Technical Springs will launch its public offer which will be a mix of fresh equity share issue and offer for sale (OFS).
The face value of the shares is Rs 10. The fresh issue comprises OFS of 25.58 lakh shares and 6.16 lakh equity shares which will be sold by the promoter group and individual selling shareholders. The offer also includes reservations for membership by eligible employees.
Under the OFS, up to 385,200 shares will be offered by Vishanji Hershey Gala, while 58,600 equity shares will be offered by Kirit Vishanji Gala (HUF).
Up to 50,000 equity shares will be sold by Nayana Gala and up to 40,000 equity shares by Satish Kotwani. Others to offer their shares will be Hemlata Dheeraj Shah (up to 31,400 shares), Dheeraj Nanchand Shah (28,000 shares), Urmil Dheeraj Shah (12,800 shares) and Rupa Sunil Mehta (up to 10,000 shares).
The offer is being made through a book-building process, in which up to 50% will be allocated to qualified institutional buyers (QIBs), 15% to non-institutional bidders and 35% to retail individual bidders. The company will use approximately Rs 37. IPO proceeds will raise Rs 1 crore to set up a new facility at Vallam-Vadagal in Tamil Nadu to manufacture high tensile fasteners and hex bolts. It will utilize Rs 11.07 crore to finance capital expenditure requirements for the purchase of equipment, plant, and machinery at WADA, Palghar, Maharashtra. Meanwhile, Rs 30 crore will be used for repayment/prepayment of certain borrowings and general corporate purposes.
About Gala Precision
Under the leadership of Kirit Vishanji Gala, the company is technology-driven with a strong focus on quality, design tool development and applications engineering. It has over 3 decades of experience in developing customized products and has approximately 15% market share in the domestic SFS (Special Fastening Solutions) market for wind turbines.
Gala Precision’s business primarily consists of the Springs Technology division, which manufactures DSS including wedge lock washers, coil and spiral springs, and SFS which manufactures anchor bolts, studs, and nuts.
Gala Precision has customers like John Deere India, Favela Transport Rail Technologies, Brembo Brakes, L&T Electrical & Automation Products and more. Schaeffler India among others. Exports to over 25 countries including major markets such as Germany, Denmark, China, Italy, Brazil, USA, Sweden, and Switzerland.
For FY 2022-23, the company’s revenue from operations increased by 13.90% to Rs 165.46 crore as against Rs 145.28 crore for FY 2021-22. Profit after tax increased by 265.13% to Rs 24.21 crore in FY2023 from Rs 6.63 crore in FY2022.
For the six months ending September 30, 2023, revenue from operations was Rs 95.68 crore, and profit after tax was Rs 9.60 crore.
PL Capital Markets Private Limited is the sole book-running lead manager for the IPO and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.