Harsha Engineers International will be the 20th IPO of the year, opening for subscription on September 14. Four issues have been launched since August.

Here are 10 things to know about the IPO:
IPO Dates
The company will open its IPO for subscriptions on September 14, and the offer will close on September 16. The anchor book of the offer opens on September 13, the day before its release.

IPO Size
Harsha Engineers plans to raise Rs 755 crore through the IPO. The offer includes a new issue of Rs 455 crore, representing 60% of the total offer, with the remaining Rs 300 crore to be sold by the promoters.
Rajendra Shah and his wife Nirmala Shah will sell shares worth Rs 66.75 crore per share through a sale offer, while Harish Rangwala and his wife Charrusheela Rangwala will sell shares worth Rs 75 crore per share. Rajendra Shah’s son Pilak Shah will sell shares worth Rs 16.5 crore.
The company has reserved shares worth Rs 2.5 crore for its employees, which they will receive at a discount of Rs 31 per share, below the final offer.

IPO Price
The price range for the IPO is fixed at Rs 314 to 330 per share.
Shares reservation for investors and Lot Size
Half of the offering size is reserved for qualified institutional buyers (including anchor books), 15% is reserved for non-institutional investors, and the remaining 35% is reserved for retail investors.
Investors can bid for at least 45 shares and then bid in multiples of 45 shares. With this, retail investors have a minimum investment of Rs 14,850 per lot and a maximum of Rs 1,93,050 for 13 lots, as they can invest up to Rs 2 lakh in the IPO.

IPO Objectives
The company will use the newly issued funds to repay some of its debt. In addition, the funds will be used for purchasing machinery, infrastructure repairs and refurbishing existing production facilities, including office premises in India, in addition to general corporate purposes.

Company Profile
Harsha Engineers claims that it is the largest manufacturer of precision bearing cages. In India, in terms of revenue, CY21 in brass, steel and polyamide cages in the global organised bearing cage market.
It operates two businesses – an engineering division that manufactures bearing cages and a solar EPC division, under which it provides complete integrated turnkey solutions for all solar photovoltaic needs – with four manufacturing facilities in China and Romania.
It serves a variety of industries, including automotive, rail, aerospace, construction, mining, agriculture, electrical and electronics, and renewable energy, with products for customers in more than 25 countries.

Promoters
Harsha Group was established in 1986 by founders and promoters Harish Rangwala and Rajendra Shah, who have over 35 years of experience in precision engineering and bearing cage manufacturing. Vishal Rangwala and Pilak Shah of Next Generation are also members of the sponsor group.
These promoters and their family members primarily own the company. As a result, their stake in the company will drop below 75% from the current 99.7% after the IPO.
Rajendra Shah is the current chairman and full-time director; Harish Rangwala is the managing director of the company, and
Vishal Rangwala is the CEO and full-time director of the company, while Pilak Shah is the chief operating officer and a full-time director.
Hetal Ukani is also a full-time board director, while the independent directors are Ambar Patel, Neharika Vohra, Kunal Shah, Bhushan Punani and Ramakrishnan Kasinathans.

Financials
Harsha Engineers’ operating income rose 51.2% to Rs 1,321.48 crore in FY22 compared to the previous FY22, with the largest contribution coming from its engineering business, which was also reflected in one-third of orders won in FY22 The engineering business in the last FY2 contributed to exports.
Profit rose 102% to Rs 91.94 crore in the same period mainly due to higher revenue from the engineering business, lower operating loss from the solar EPC business and higher foreign exchange gain.
On an operational level, its EBITDA margin expanded to 13.9% in FY21 but fell to 12.8% in FY22 due to higher input costs. Revenue CAGR in 2020-22 was 22%, while profit CAGR was 105% in the same period.

Share Allotment and Listing Dates
Harsha Engineers will have until September 21 to complete the distribution of shares, while unsuccessful investors will receive funds from their bank accounts by September 22, and shares will be credited to accredited investors’ Demat accounts by September 23.
The listing of shares on the BSE and NSE will take place on September 26, according to the IPO schedule provided by the company.
Axis Capital, Equirus Capital and JM Financial acted as the book-runners for the offering, while Link Intime India was the registrar for the offering.

Risks and Concerns
Here are the key risks and concerns highlighted by brokerages:
A large portion of the company’s engineering business revenue relies on a limited customer base. As of March 2022, it is a supplier to the world’s top six bearing manufacturers, contributing 75% of its engineering business.
In addition, businesses from Europe and China contributed more than 50%. Motilal Oswal said that while Harsha Engineers has not been significantly affected so far and orders remain strong, prolonged uncertainty could impact future revenue.

The company is also exposed to foreign exchange volatility as more than 60% of its business comes from exports.
Motilal Oswal said contingent liabilities worth Rs 90 crore, or about 10% of the balance sheet, could pose risks.