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Introduction To Gala Precision IPO
The IPO of Gala Precision Engineering is a book-built issue worth Rs 167.93 crore. It consists of a fresh issue of 0.26 crore shares aggregating Rs 135.34 crores and an offer for sale of 0.06 crore shares aggregating Rs 32.59 crores.
The subscription for the Gala Precision Engineering IPO would open on September 2, 2024, and close on September 4, 2024. Allotment for the Gala Precision Engineering IPO is expected to be finalised on Thursday, September 5, 2024.
Listing on the BSE and NSE is likely to be on Monday, September 9, 2024. The Price band for the IPO of Gala Precision Engineering is between Rs 503 to Rs 529 per share.
The Minimum investment lot size for an application is 28 shares, and the minimum investment for retail would be Rs 14,812. The Minimum investment for small non-institutional investors (sNIIs) would be 14 lots of 392 shares, amounting to a total of Rs 2,07,368; for big non-institutional investors (bNIIs), it would be 68 lots of 1,904 shares amounting to Rs 10,07,216 in total.
PL Capital Markets Private Limited is the book-running lead manager of the Gala Precision Engineering IPO. Further, Link Intime India Private Ltd is the registrar of the issue.
Gala Precision Engineering Ltd IPO Details
Major events and other details:
| Particulars | Details |
| IPO Date | September 2, 2024 to September 4, 2024 |
| Face Value | Rs 10 per share |
| Price Band (Gala Precision Engineering Ltd share price) | Rs 503 to Rs 529 per share |
| Lot Size | 28 Shares |
| Total Issue Size | 31,74,416 shares (aggregating up to Rs 167.93 Crore) |
| Fresh Issue | 25,58,416 shares (aggregating up to Rs 135.34 Crore) |
| Offer for Sale | 6,16,000 shares of Rs 10 (aggregating up to Rs 32.59 Crore) |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE, NSE |
| Share-holding pre-issue | 1,01,11,584 |
| Share-holding post issue | 1,26,70,000 |
Schedules (Tentative)
| Particulars | Details |
| IPO Open Date | Monday, September 2, 2024 |
| IPO Close Date | Wednesday, September 4, 2024 |
| Basis of Allotment | Thursday, September 5, 2024 |
| Initiation of Refunds | Friday, September 6, 2024 |
| The credit of Shares to Demat | Friday, September 6, 2024 |
| Listing Date | Monday, September 9, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on September 4, 2024 |
Investors’ categories and shared offered:
| Investor Category | Shares Offered |
| QIB Shares Offered | Not more than 50.00% of the Net offer |
| Retail Shares Offered | Not less than 35.03% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15.00% of the Net Issue |
Lot sizes and their values:
| Application | Lots | Shares | Amount |
| Retail (Min) | 1 | 28 | Rs 14,812 |
| Retail (Max) | 13 | 364 | Rs 1,92,556 |
| S-HNI (Min) | 14 | 392 | Rs 2,07,368 |
| S-HNI (Max) | 67 | 1,876 | Rs 9,92,404 |
| B-HNI (Min) | 68 | 1,904 | Rs 10,07,216 |
Anchor Investors Details:
| Particulars | Details |
| Bid Date | August 30, 2024 |
| Shares Offered | 9,50,586 |
| Anchor Portion Size (In Cr.) | 50.29 |
| Anchor lock-in period end date for 50% shares (30 Days) | October 5, 2024 |
| Anchor lock-in period end date for remaining shares (90 Days) | December 4, 2024 |
Gala Precision Engineering Ltd IPO GMP Details:
The Current Grey Market Premium (GMP) of Gala Precision Engineering IPO as of 31st August, 2024, 09:30 AM is Rs 200. At the price band of Rs 503.00 to Rs 529.00 per share, the expected listing price of Gala Precision Engineering IPO is Rs 729, i.e. today’s GMP added to the cap price.
This translates to an expected profit/loss of 37.81% on the share. Retail Subject to Sauda for Gala Precision Engineering IPO is Rs 430, and that of Small HNI Subject to Sauda is Rs 60200.
Gala Precision Engineering Ltd Company Details:
Gala Precision Engineering Limited was originally incorporated in Feb 2009. It manufactures precision parts such as disc and strip springs, coil and spiral springs, and special fastening solutions.
These products find their application in the electrical, off-highway equipment, infrastructure, and general engineering, as well as automotive and railway sectors. The company sells its products to original equipment manufacturers.
The clients of the company are found in many countries like Germany, Denmark, China, Italy, Brazil, the USA, Sweden, and Switzerland. It operates from two manufacturing facilities in Palghar, Maharashtra.
The proposed manufacturing plant that will manufacture high-tensile fasteners and new products like bolts is to be located at the Industrial Complex, Vallam-Vadagal, SIPCOT, Sriperumbudur, Tamil Nadu. Gala Precision Engineering Ltd. manufactures High-Tensile Fasteners, Disc and Strip Springs, Coil and Spiral Springs, and Wedge Lock Washers at high levels of precision. Key customers include major OEMs, Tier-1 suppliers, and channel partners catering to various industries.
Gala Precision Engineering believes in lean manufacturing concepts and focuses on semi-automation and automation at all times so that errors are eliminated, and productivity is maximised.
Financials Of Gala Precision Engineering Ltd
Overview of the Financial Statements:
| Period Ended | 31-Mar-2024 | 31-Mar-2023 | 31-Mar-2022 |
| Assets (Rs in crores) | 188.69 | 170.39 | 145.62 |
| Revenue (Rs in crores) | 204.38 | 167.08 | 147.96 |
| Profit After Tax (Rs in crores) | 22.33 | 24.21 | 6.63 |
| Net Worth (Rs in crores) | 104.45 | 83.66 | 59.32 |
| Reserves and Surplus (Rs in crores) | 94.67 | 81.13 | 56.79 |
| Total Borrowing (Rs in crores) | 55.03 | 58.6 | 56.89 |
Ratio analysis
| Key performance indicator (KPI) | Values |
| Return on equity (ROE) | 23.59% |
| Return on capital employed (ROCE) | 19.91% |
| Debt/Equity ratio | 0.53:1 |
| Return on net worth (RoNW) | 21.38% |
| Market Price to Book Value (P/BV) | 5.12 |
| Profit after tax (PAT) Margin (%) | 11.89 |
Gala Precision Engineering Ltd IPO RHP – Business Risks
Following are four major business risks associated with the company as per its Red Herring Prospectus.
1) The company exports its products to countries including Germany, Switzerland, Finland, Italy, Denmark, the USA, China, and Brazil. Unfavorable events happening in these countries like currency rate fluctuation, depreciation of the Rupee of India, and compliance with many regulatory standards and foreign legislations may adversely affect the company’s business, financial position, and operational results.
2) The transportation of raw materials and finished goods depends on third-party transporters. A stoppage of their activity, or a loss of quality in service, might mean intense financial losses for the respective firms.
3) Some immovable properties including at the company’s registered and corporate office stand leased. If the company is not able to renew leases of existing premises or find substitute premises for its business at reasonable cost or on reasonable terms, this may have a material adverse impact on the business, financial condition, and operations of the company.
4) The company and one of the promoters have pending legal proceedings in the ordinary course of business. These cases are at various stages, from original filings to ongoing negotiations. The Company considers a legal case as significant if the monetary claim exceeds 5% or more of the Company’s consolidated profit after tax for the most recent fiscal year, being Rs 11.17 million for Fiscal 2024.
Any legal case impending or filed that has a significant adverse effect on the company’s business, operation, financial condition, or reputation is considered significant, whether or not the monetary amount is specified.
Frequently Asked Questions (FAQs)
What is the listing date of the Gala Precision Engineering Ltd. IPO?
The Tentative date for the listing of the above IPO is Monday, September 9, 2024, on both NSE and BSE.
Who are the competitors of Gala Precision Engineering Ltd?
The competitors of Gala Precision Engineering Ltd are Harsha Engineers International Ltd, SKF India Ltd., Sundram Fasteners Ltd., Rolex Rings Limited, etc.
What are the major objectives for the Gala Precision Engineering IPO?
The objectives include – Building a new facility at Sriperumbuddur, Tamil Nadu, for manufacturing high-tensile fasteners and hex bolts. The Company’s strategic investment in state-of-the-art equipment, plant, and machinery at Wada, Maharashtra, underlines its commitment to quality and efficiency. Repayment of some of the borrowings of the Company. Further, Utilizing the funds for general corporate purposes.
What is the Opening date of the Gala Precision Engineering Ltd IPO?
The opening date of Gala Precision Engineering Ltd IPO is Monday, September 2, 2024
What is the closing date of Gala Precision Engineering Ltd. IPO?
The closing date of the IPO of Gala Precision Engineering Ltd is Wednesday, September 4, 2024.
Where to subscribe for the Gala Precision Engineering Ltd IPO?
Investors will be able to apply for the Gala Precision Engineering IPO online through their bank account (ASBA) or broker (UPI). Equities are only available in Demat form.
Where can I find the RHP and DRHP of the IPO?
RHP (Red Herring Prospectus) and DRHP (Draft Red Herring Prospectus) of Gala Precision Engineering Ltd IPO is available on www.sebi.gov.in.
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