top of page
  • Writer's pictureJatin Agarwal

Aeroflex Industries IPO


aeroflex industries logo

Company and IPO Overview:


Aeroflex Industries previously known as Suyog Intermediates Private Limited was incorporated in 1993. Aeroflex Industries manufactures and supplies environment-friendly metallic flexible flow solution products including braided hoses, unbraided hoses, solar hoses, gas hoses, interlock hoses, hose assemblies, vacuum hoses, braiding, lancing hose assemblies, jacketed hose assemblies, exhaust connectors, exhaust gas recirculation (EGR) tubes, expansion bellows, compensators and related end fittings collectively known as flexible flow solutions catering to global as well as domestic markets.


The products of Aeroflex Industries are used by key industries which include Aerospace and Defence, Semiconductors, Robotics and Automation, Petrochemicals and Oil Refineries, Chemicals, food and Pharmaceuticals, Solar, Natural Gas and Steel and Metal among others. As of FY23, the company has supplied its products to more than 80 countries including Europe, and the USA among others which constituted 80.60% of the company’s revenues. The company's clientele includes distributors, fabricators, Maintenance Repair and Operations (MRO) firms, Original Equipment Manufacturers (OEMs), and enterprises spanning various industries.


The product portfolio of Aeroflex Industries encompasses a variety of categories, including braided hoses, unbraided hoses, solar hoses, gas hoses, vacuum hoses, braiding, interlock hoses, hose assemblies, lancing hose assemblies, jacketed hose assemblies, exhaust connectors, exhaust gas re-circulation (EGR) tubes, expansion bellows, compensators, and associated end fittings.


The manufacturing facility of Aeroflex Industries is situated in Taloja, Navi Mumbai, Maharashtra. This facility holds certifications such as ISO 9001:2015 (Quality Management System), ISO 14001:2015 (Environmental Management System), ISO 45001:2015 (Occupational Health & Safety), NABL ISO/IEC 17025:2017 (Testing Certificate), and statements of conformity for design, manufacturing, and testing standards, including EN ISO 10380:2012 and BS 6501-1 (E:2004), along with a Certificate of Design Assessment.


Aeroflex Industries IPO is the next main board IPO which is ready to go public and the company is about to raise around ₹ 351 crores via IPO comprising Offer For Sale upto ₹189 crores and Fresh Issue upto ₹ 162 crores. The price band of the issue is ₹ 102 to ₹ 108 with a minimum market lot of 130 shares. Aeroflex Industries IPO subscription for retail quota is 35.00%, NII is 15.00% and QIB is 50.00%.


Financials (rounded off):

Date

Total Revenue (₹ in cr)

​​​PAT (₹ in cr)

​31/03/2021

145

6

31/03/2022

241

27

31/03/2023

269

30


Objectives of the Issue:

1. Complete or partial repayment and/or prepayment of specific outstanding secured borrowings (including associated foreclosure charges, if applicable) obtained by our Company.

2. Sustaining the working capital necessities of the Company.

3. Addressing general corporate purposes and certain unidentified inorganic acquisitions.


IPO Details:

IPO Date

22/08/2023-24/08/2023

Face Value

₹2 per share

IPO Price Band

₹102-₹108 per share

IPO Lot Size

13 Shares

Listing at

NSE, BSE

Basis of Allotment

29/08/2023

Credit of Shares in Demat

31/08/2023

Listing Date

01/09/2023

Pre-Issue Shareholding

91.09%

Post-Issue Shareholding

69.99%

Retail Minimum Lot Size

130 shares (₹14,040)


Valuations & Margins:

Indicators

FY 21

FY 22

FY 23

EPS

0.53

2.41

2.64

P/E

-

-

40.91

EBITDA (%)

15.43

19.39

20.05

Debt/Equity

0.9

0.45

0.39

ROCE (%)

17.13

36.29

31.91


Important things to note about the Company:


Top reasons to consider the IPO:


1. Aeroflex Industries is a Primary Manufacturer of flexible flow solutions having no listed peers with advanced manufacturing facilities and R&D infrastructure along with High entry and exit barriers demonstrating consistent and strong financial performance.


2. Aeroflex Industries manufactures flexible flow solutions which find applications in various industrial segments. The company believes that the growth of its business is directly linked to the growth in both traditional industrial segments and Emerging industries.


3. As for FY23, Aeroflex Industries has supplied its products to 51 countries and has established a significant presence in the export markets by providing specified SS flexible flow solutions across industries.


4. The solutions provided by Aeroflex Industries face strict quality standards from customers and regulators, making it hard for new players to enter the market.


Risk factors to watch out in the IPO:

1. Aeroflex Industries derive a majority of its revenue by exporting to other countries, potentially making it susceptible to substantial import duties or jurisdictional restrictions. Any inability to comply with related requirements can adversely affect the business.


2. Aeroflex Industries rely on third parties for the supply of raw materials and delivery of products. Any disruption in the supply and delivery of raw materials and finished goods could affect the company’s production and increase its costs.


3. The business of Aeroflex Industries is dependent on its single manufacturing facility and any slowdown or shutdown in the said facility will have an adverse effect on its operations.


4. Routine business operations necessitate numerous approvals, NOCs, licenses, registrations, and permits, also due to the nature of the business, the company does not have long-term agreements with suppliers for raw materials or with its customers.


Final thoughts:

Aeroflex Industries IPO Review 2023: Given the industry’s consistent expansion, coupled with the company’s own growth and absence of listed competitors, the company’s outlook appears favorable for the future.


Crisp Insights:

  • Aeroflex Industries IPO GMP Today: The Company is commanding a GMP of around Rs.65.

  • Aeroflex Industries IPO Review: Listing gains likely as per GMP data.

  • Aeroflex Industries GMP is strong and hence, investors can look to invest for listing as well as long term gains.


Disclaimer: All information is provided for educational and informational purpose only. Data is fetched from publicly available sources such as the DRHP filed by the company. The website or the author takes no guarantee for the accuracy of the data however, we have tried our best to present accurate data to out readers. Please consult a financial advisor or do your own analysis before investing/trading in the stock market.


315 views0 comments

Recent Posts

See All

Comments


bottom of page