Sansera Engineering Limited was established in Bengaluru in 1981. The company started its business operation by manufacturing the passenger vehicle component in 1986. In 1996 they set up a plant to provide highly precisive engineering components for two-wheeler sectors. It also came in the LCV Segment, that is light commercial vehicle segment, in 2011. Th company is also in the business of production of parts for off-road vehicles since 2009. Grab all the information about Sansera Engineering Limited IPO Review.
In 2013, they set up a manufacturing unit and an R&D unit to create high-accuracy aluminum and titanium machined aviation parts. The company also purchased a 100% proprietorship in Sansera, Sweden, in April 2017. It supported their entrance into the HCV Segment, Heavy commercial Vehicle segment. The company is always focusing on verticals of the auto and auto ancillaries’ business, expanding their client base and association tie-ups with OEM’s. Their service caters across automotive and non-automotive sectors.
Objects of the IPO Issue:
- Prepayment of all or significant part of the loan on the company on a consolidated basis.
- To accomplish corporate targets.
Basis of the IPO Offer:
- The company is the Leading supplier of top-notch accuracy-designed parts, with developing market share in the overall industry in auto and non-auto ventures.
- The company has a business model with a wide product and service range.
- It has Excellent designing and configuration, machine development, and automation capacities.
- Fungibility of gear, innovation, and manufacturing lines across a portfolio of products and its sector.
- Advancement and upgraded usefulness of the products.
- Long-term associations with notable Indian and global OEM customers.
- Financial outcomes that have beat industry drifts and have industry-driving measures.
- Employee culture focuses on collaboration and cooperation between capacities, with an expert and educated directorate and supervisory team.
SENSERA ENGINEERING IPO Details:
Sansera Engineering Limited, a company with headquarters in Bengaluru, has submitted its DRHP to SEBI for an IPO Offer. The IPO Offer is of 17,244,328 equity shares. The IPO is a proposal of OFS of all 17,244,328 equity shares. There is no new issue in the IPO offer. The face value of the equity share is Rs.2 has been submitted in the DRHP of the company. The company is waiting for SEBI’s approval to float its IPO in the market.
The Basis of Allotment is 50% reserved for Qualified Institutional Investors (QII), 35% for retail investors and 15% for Non-Retail Investors. The total IPO Size is 1282.98 Crores.
|IPO Opening Date||14 September 2021|
|Issue Type||Book Building type|
|Listing At||BSE, NSE|
|IPO Price||734 – 744 / equity shares|
|Face Value||2/ share|
|Issue Size||17,244,328 equity shares|
|Offer for Sale||17,244,328 equity shares|
|Minimum Order Quantity||20|
|IPO Close Date||16 September 2021|
|Basis of Allotment Date||21 September 2021|
|Initiation of Refunds||22 September 2021|
|The Credit of Shares to Demat Account||23 September 2021|
|IPO Listing Date||24 September 2021|
Strengths and Growth Objectives Of Sensera Engineering IPO:
- As indicated by a CRISIL report, the Automotive parts industry in India will track the growth of 18% CAGR till 2023.
- PM Modi’s Initiative of Atmanirbhar Bharat is also another growth aspect for the country. Sansera Engineering Limited is one of the direct beneficiaries of this plan as it is a growing company, and the company has received funds also.
- Nature of their indicative administrations.
- Experienced Promoters and supervisory director and management group
- The company has the perfect foundation and Integrated capacities to convey quality Products.
- The company has also achieved a quality assurance certification as per the Industrial Standards.
- Sansera Engineering Limited will expand its manufacturing unit capacity. It will increase their revenue and will reflect positivity in their operating margins.
- The organization has a well-established order book with the excellent customer base.
- The company has significantly reduced its debt and improved EBITDA and operating margins.
- They have a focused framework with customer experience.
- It is a Leading provider of high precision and quality engineering products used in the automotive and non-automotive industry. For the last two years, the company is amongst the top 10 global suppliers of a connecting rod in LCV and CV segments.
- The company is also the biggest supplier of the connecting rod in all segments of the Domestic Market for the last two years.
- It has a diversified product and service portfolio. The company is engaged in various segments.
- Sandra has Strong Engineering and Designing capacities.
- It also has a Strong association with regarded Indian and Global OEMs.
- Strong and Healthy Balance sheet.
- The company registered a growth in its customer percentage of business for their current product supply. It indicates the trust of their customers in their product.
Weakness and associated threats Of Sensera Engineering IPO:
- The COVID-19 pandemic had contrarily affected their business. It has affected the estimated operating margins and projects delivery.
- They don’t have any drawn-out long-term supply arrangements set up with their customers.
- Sansera Engineering Limited depends on the selling of their products to a couple of significant customers only. It signifies that they don’t have a diversified customer base.
- Their steady business pipeline may not propel their future development rate or the quantity of new business and manufacturing orders they will get.
- They are engaged in the production and manufacturing of complex automotive and non-automotive parts. It is a tedious and expensive interaction with obscure cut-off times and outcomes.
- Failure to adjust to industry drifts and developing advancement to fulfill their customers’ requirements can negatively impact the company.
- For transportation and brief conveyance of their products to customers, they have outsourced their logistics department. It is also another major danger to their business operation. It comes under Supply and transportation disruptions
- Their working capital requirements are supposed to remain high for FY22 and FY23.
- Their Balance sheet does not include the Current Maturity of Long-Term Borrowings.
- For the conveyance of raw materials, the company relies on a third party.
- Sansera Engineering Limited is vulnerable to fluctuation in raw material costs.
- The inaccessibility of the raw material is also another primary concern for them. The company has no supply agreement on a long-term basis with any supplier.
- Their quality norms, competition and change associated with supply and demand can affect their business operation.
- The company also requires many funds for working capital to proceed with development in the company. The failure to meet their prerequisites for operation will affect their business operation.
- Their failure to prevent interferences in service could lead to a negative impact on their business.
- Strict compliance with laws and Guidelines. Along with renewing certain registration norms.
- Their business will be affected if they don’t execute their growth plan properly.
- Factors such as fuel prices, consumer demand, disposable income levels, consumer confidence and other general economic conditions in-country and amongst the customers can also influence their business operations.
Financial Trends Of Sensera Engineering IPO:
- Regarding the production volume in units, the company has increased its global market share for Connecting rods. LCV increased the market share by 1.56 times from 0.9% to 2.3% in FY21. This ratio is much better; it increased the market share by 233 times from 0.9% to 3.0% in FY21.
- The company is engaged in two-wheeler, passenger, and commercial vehicle verticals for the automotive and non-automotive sectors. It has also started manufacturing forged & machined high precision components for Agriculture and Aero Space Industry also. It will increase their operating margins, revenue and net profit on the top-line of their core business.
- For FY’21, the Automotive sector contributed 88.45% and non-automotive 11.45% of the revenue.
- The company derives around 65% of its revenue from India and 35% from other countries.
- The company is one of the major suppliers of connecting rods globally. The company has 15 manufacturing plants across India, of which nine are in Bangalore.
- Between FY14 and FY18, the company added 21 new customers.
- Sansera Engineering’s total consolidated income increased 6.7% to Rs 1572.3 Crore in FY21 from 1473.4 Crore in FY20.
- Its net profit increased by 37.5% to Rs 109.86 Crore in FY21 from Rs 79.91 Crore in FY20.
- Sansera Engineering Limited has cash profit margins of 13.65%. It also registered an EBITDA Margin of 12.63% in FY21.
- The company has a net profit margin of 7% in FY21. The Return on the capital employed (ROCE) is 10.8%.
- The company registered a growth of 34.8% in their Basic EPS in FY21. In FY21, it stood at 21.02, while in FY20, it was 15.63 only.
- The company has a debt-to-equity ratio of 0.61 only. It signifies that the company can overcome its debt easily at any time.
- Overall the company has sound fundamentals and a great objective for growth in the future.
|Financial Period||Basic EPS (in INR)||Diluted EPS (in INR)|
|Financial Year 2021||21.02||20.55|
|Financial Year 2020||15.63||15.28|
|Particulars||Value as in FY21|
|Net Sales Growth||6.32%|
|Core EBITDA Growth||22.22%|
|Particulars||For the year ended ( in Cr.)|
|Profit After Tax||109.86||79.91||98.06|
Relation with Various OEM’s
|Two-wheelers||Bajaj, Harley Davidson, Hero, HMSI, Royal Enfield, KTM, Yamaha|
|Passenger Vehicles||FCA, Honda Cars, Maruti, Toyota, Volkswagen|
|LCV/HCV||Ashok Leyland, CNHi|
|Off-road vehicles and others||Bosch, JCB, Polaris|
Promoter and Share Holding Pattern before IPO
The promoter of the company is:
- S Sekhar Vasan
- F R Singhvi
- Unni Rajagopal K
- D. Devaraj
Sansera Engineering Limited
Plant 7, Plot No. 143/A, Jigani Link Road, Bommasandra Industrial Area,
Anekal Taluk, Bengaluru 560 105, Karnataka, India;
Tel: +91 80 2783 9081
Tel: +91 33 4015 6000
Registrar to the Sensera Engineering IPO Offer:
Link Intime India Private Ltd
C 101, 247 Park, L.B.S.Marg,
Vikhroli (West), Mumbai – 400083
Phone: +91-22-4918 6270