Bengaluru-based aerospace startup Unimech Aerospace and Manufacturing is to hit the headlines soon. It is coming up with its ₹500 crore Initial Public Offering (IPO) equipped with a price band of ₹745-785 per share. The company is trying to position itself as a key player in the aerospace manufacturing space.
The IPO is scheduled to open on December 23 and close on December 26. It will be a mix of fresh equity worth ₹250 crore and offer for sale (OFS) of ₹250 crore by the promoters. The fresh funds will go toward expanding production capabilities and to address working capital needs. The OFS indicates that the promoters are trying to cash out on the growth of the company.
Unimech was founded in 2016 and has carved a niche for itself by manufacturing tools and components for aeroengine and airframe production such as precision tools, assembly platforms and turnkey systems catering to global aerospace giants. It is learned that 91% of its revenue comes from exports and mainly to the United States.
Financial growth of the company has been remarkable as its revenue jumped 122% in FY24 to ₹208.77 crore and profits soared 155% to ₹58.13 crore. The growth has been mainly fueled by an increase in production capacity and a growing order book that stood at ₹99.24 crore as of June 2024.
The aerospace manufacturing sector is highly competitive equipped with listed peers like MTAR Technologies and Paras Defence. Moreover, reliance on exports could also expose the company to global economic uncertainties.
Retail investors can participate in the IPO with a minimum investment of ₹14,915 for one lot of 19 shares. The allocation is balanced equipped with half the issue reserved for institutional buyers, 15% for non-institutional investors and remaining 35% for retail participants.
The decision of Unimech to go public is timely as the Indian aerospace sector is gaining momentum equipped with its proven capabilities and ambitious plans. The company has the potential to stand out, but potential buyers should weigh the risks alongside the opportunities. The story of Unimech is one of growth, ambition and a bet on the future of Indian aerospace manufacturing. Whether it can soar to new heights post-IPO will be worth watching.
Bengaluru-based aerospace startup Unimech Aerospace and Manufacturing is to hit the headlines soon. It is coming up with its ₹500 crore Initial Public Offering (IPO) equipped with a price band of ₹745-785 per share. The
