Carraro India IPO Review

Carraro India is a technology driven integrated supplier that develops complex engineering products and solutions for their original equipment manufacturer (“OEM”) customers. They are an independent tier 1 solution provider of axles, transmission systems and gears for the agricultural tractor and construction vehicle industries in India. They support the full value chain of services as a solution provider for axles, transmission systems, gears and other related components with in-house product design manufacturing capabilities.

The Company is promoted by strong Promoters, namely, TOMASO CARRARO, ENRICO CARRARO, CARRARO S.p.A. AND CARRARO INTERNATIONAL S.E.

The Revenues from operations for the period ended on Sep 30, 2024, Fiscals ended 2024, 2023 and 2022 were ₹ 9,227.39 Million, ₹ 18,065.47 Million, ₹ 17,332.98 Million and ₹ 15,200.53 Million respectively. The EBITDA for the period ended on Sep 30, 2024, Fiscals ended 2024, 2023 and 2022 were ₹ 1,010.96 Million, ₹ 1,499.95 Million, ₹ 1,248.11 Million, and ₹ 828.63 Million, respectively. The Profit after Tax for the period ended on Sep 30, 2024, Fiscals ended 2024, 2023 and 2022 were ₹ 496.32 Million, ₹ 633.73 Million, ₹ 499.02 Million, and ₹ 196.65 Million respectively. This indicates steady growth in financial performance.

The Company Key Performance Indicates the pre-issue EPS of ₹11 and post-issue EPS of ₹11 for FY24. The pre-issue P/E ratio is 64x, while the post-issue P/E ratio is 64x against the Industry P/E ratio is 32x. The company's ROCE for FY24 is 19.35%, ROE for FY24 is 17.69% and RoNW16.92%. The Annualised EPS based on the latest financial data is ₹17.5 and PE ratio is 40.22x. These metrics suggest that the IPO is fully priced.

The Grey Market Premium (GMP) of Carraro India showing potential listing gains of 10.84%. Given the company's financial performance and the valuation of the IPO, we recommend Investors to Avoid to the Carraro India Limited IPO for Listing gain.

Disclaimer: The information provided in this IPO review is for educational and informational purposes only and should not be construed as financial advice or an offer to buy or sell securities. The review must not be used as a singular basis of any investment decision. The views herein are of a general nature and do not consider the risk appetite or the particular circumstances of an individual investor; readers are requested to take professional advice before investing. Nothing in this document should be construed as investment advice. The content is based on publicly available information and market perceptions as of the date of publication and is subject to change. Neither the author nor the website is responsible for any losses or damages arising from the use of this information. 

About the Author
 CA Abhay Kumar (Also known as  CA Abhay Varn) is a qualified Chartered Accountant by profession and cleared CA at age 21. He is a SEBI Registered Research Analyst with Registration Number - INH300008465. He Possesses 8+ years of experience in the Stock Market Field and has also worked in Big CA firms during the training period. He is good at Technical analysis and Fundamental Analysis and uses both Technical and Fundamental analysis along with five other important factors that affect the movement of the Market namely Global Market Analysis, Upcoming Event Analysis, Institutional Money Analysis, Derivative Data Analysis, and Emotions and Sentiment of Traders and Investors in his Framework called - Technical Fundamental GUIDE to find the winning Trades.
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