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Reliance Securities Report

Unimech Aerospace And Manufacturing Ltd. launched its initial public offering today and the issue closes for subscription on Dec. 26. A niche player specialising in the manufacturing of Aero-tooling products has fixed the price band in the range of Rs 745-785 per share.

The Rs 500 crore IPO comprises of a fresh issue of Rs 250 crore and an offer-for-sale component of Rs 250 crore.

Object of the Issue

  • Funding of capital expenditure for expansion through purchase of machineries and working capital.

  • Investment in subsidiaries to fund purchase of machinery and working capital requirements.

  • Repayment/pre-payment in full or in part of certain borrowings.

Strengths

  • Approved supplier for various industry leaders in aerospace, defence, semiconductor and energy sectors.

  • leading exporter of aerospace components, with exports significantly contributing to our overall revenue.

  • Global high precision and engineering solutions company with capabilities to manufacture build to print and build to specifications.

  • Qualified and experienced management team.

Our View

Unimech Aerospace And Manufacturing Ltd. is a global high-precision engineering solutions company specializing in complex manufacturing solutions for the aerospace, defence, energy, and semiconductor industries. Unimech Aerospace And Manufacturing Ltd. is enhancing its global footprint in strategic regions and expanding to new markets for new clients, capturing a higher market share from existing customers utilizing its capacity expansion and collaborative manufacturing for its growth in MRO markets and aircraft fleet with a higher fixed asset turnover ratio in the coming years.

Unimech Aerospace And Manufacturing is also focusing on inorganic growth through acquisitions and partnerships with customers for the end use in various sectors like defence, automotive and energy sectors improving its consistent financial performance in the coming years. Hence, we recommend a Subscribe to the issue.

Key Risks

  • Any adverse changes in the aerospace sector could adversely impact business.

  • High dependence on top 5 customers as sales are largely dependent on them.

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