Issue Highlights
Issue Period
|
5/10/16-7/10/16
|
Price Band (Rs.)
|
467-472
|
Issue Size(shares)
|
2,46,13,024
|
Issue Size (Rs. crore) #
|
1161.73
|
Issue Type
|
100% Book built
|
Face Value (Rs.)
|
10
|
Listing
|
BSE,NSE
|
Industry
|
Auto ancillary
|
Registrar
|
Link Intime
|
Minimum Bid Quantity
|
30 shares
|
Maximum Retail Subscription
|
Rs. 1,98,240
|
BRLM
|
Axis Capital, Citigroup global
|
# derived figure
Issue Details
Offer for Sale: 2,46,13,024 shares/ Rs. 1161.73 crore by
promoter Anurag Jain and Actis components & system investments
Fresh Issue: Nil
Equity Shares
Outstanding Prior to the Issue : 14,06,62,848
Equity Shares
Outstanding After The Issue : 14,06,62,848
Objects of the Issue
This issue being a
pure offer for sale, the company shall not be receiving any proceeds from this
issue. This issue shall provide listing benefits to the company.
Company Profile
In terms of revenue,
ETL is the largest 2-wheeler and 3-wheeler automotive component manufacturer in
India. For most of its products, ETL is
the tier 1 supplier to OEMs (Original Equipment Manufacturer). ETL is a
complete solution provider company providing services from the conception to
end-user delivery. The company derives around 70 % of its revenue from India
and the rest 30 % comes from its European manufacturing units situated in Italy and Germany.
Besides this, ETL
also makes specified components for
4-wheelers, LCVs and HCVs.
 |
| Segment wise Production breakup |
The company predominantly
makes aluminum alloy wheels for motor-bikes, shock absorbers and forks for ,
CVT systems and brake systems besides providing aftermarket services to cater
the replacement market.
With Bajaj Auto
Limited being its largest customer a few reputed names like Royal Enfield,
Honda, M&M, Tata Motors, Fiat India
and Yamaha are present on its client list.
Strengths:
(1)
It’s
aftermarket services-which being a
promising segment with higher margins-revenue is growing at a CAGR of 17.6 %
(2)
ETL is
the market leader in India in selected
product segments
(3)
It has
18 strategically placed manufacturing units in India
(4)
The
company gives a strong emphasis on R&D
(5)
ETL has
25 plants across India, Italy and Germany
Risks & Threats
(1)
Around
62 % of the revenue comes from the top 3 customers with Bajaj auto contributing
around 42 % of the revenue and such a client
concentration could affect the profitability in case of one more client
parting its ways or not performing well
(2)
The
company’s performance is directly related to the overall wellness of the Indian
and European automotive sector and any slump, recession or fuel crisis like
situation shall not augur good for the company
(3)
Brexit
might be impacting of its profitability
Financial Profile #
Parameter
|
FY
16 Value
|
PE Multiple
|
22.82
|
PEGProfit (4 year)
|
1.86
|
Net Profit Margin (%)
|
5.55
|
EV/EBITDA
|
11.7
|
M-Cap/Sales
|
1.27
|
ROE (%)
|
20.01
|
ROCE (%)
|
23.91
|
TIE
|
9.9
|
AR Collection Period
|
39 days
|
Price to Book value
|
4.57
|
# using upper end of
the price-band
Comparison with the listed Peers #
PEGProfit
|
NPM (%)
|
ROCE(%)
|
ROE(%)
|
PE
|
EV/EBITDA
|
|
Endurance Tech
|
1.86
|
5.5
|
23.91
|
20.01
|
22.82
|
11.7
|
Bharat Forge
|
1.74
|
16.28
|
13.18
|
19.25
|
31.32
|
15.48
|
Motherson Sumi
|
4.31
|
13.4
|
26.54
|
29.33
|
31.94
|
30.49
|
Munjal Showa
|
NM
|
4.07
|
13.21
|
13.5
|
14.16
|
5.56
|
# moneycontrol data
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