Unimech Aerospace and Manufacturing IPO: Investment Potential with Strong Listing Gains

Unimech Aerospace and Manufacturing, a leader in high-precision engineering solutions, specializes in manufacturing complex products tailored to client specifications in industries such as aerospace, energy, and semiconductors. With capabilities spanning machining, fabrication, assembly, and testing, Unimech provides build-to-print and build-to-specifications offerings that cater to some of the world’s most advanced technological sectors. The company has been a trusted partner for global industries requiring high-performance engineering products.

The company has launched a Book Built Issue IPO to raise ₹500.00 Crores, which includes a Fresh Issue of 31.84 lakh shares worth ₹250.00 Crores and an Offer for Sale of 31.84 lakh shares totaling ₹250.00 Crores. The IPO subscription period commenced on December 23, 2024, and will close on December 26, 2024. The allotment is expected to be finalized on December 27, 2024, with shares listed on BSE & NSE on or about December 31, 2024.

IPO Pricing and Subscription Details

The price band for the Unimech Aerospace IPO is set at ₹745 to ₹785 per equity share. At the upper IPO price of ₹785, the Market Capitalization of Unimech Aerospace and Manufacturing will be approximately ₹3,992.26 Crores. The lot size for this IPO is 19 shares, meaning retail investors need to invest a minimum of ₹14,915, and HNIs must invest a minimum of ₹208,810 (14 lots).

The Grey Market Premium (GMP) for this IPO as of December 23, 2024, is reported to be ₹550, indicating potential listing gains of 70.07%. This reflects the investor sentiment surrounding the IPO, signaling strong demand and confidence in the company’s market outlook.

Company Leadership and Expertise

Unimech Aerospace is managed by a team of seasoned professionals led by Anil Kumar P, the Chairman & Managing Director, who brings more than 20 years of experience in manufacturing. The leadership team also includes Ramakrishna Kamojhala, the Whole Time Director & Chief Financial Officer, with over 13 years of experience in corporate finance. The directors, including Mani P, Rajanikanth Balaraman, and Preetham S V, also possess more than 20 years of industry experience, contributing significantly to Unimech’s ongoing success and expansion in high-precision engineering sectors.

Financial Performance and Metrics

For the fiscal year ending September 30, 2024, Unimech Aerospace posted revenues of ₹1,275.77 million, up from ₹949.30 million in FY2023. The EBITDA for FY24 is ₹557.49 million, a significant increase from ₹353.27 million in FY2023. The Profit After Tax (PAT) for FY24 stood at ₹386.80 million, continuing a positive upward trend from ₹228.13 million in FY2023.

The company’s Return on Capital Employed (ROCE) for FY24 is 54.36%, and its Return on Equity (ROE) is 53.53%, showcasing its efficient use of capital and consistent profitability. The pre-issue P/E ratio is 59.33x, and the post-issue P/E ratio is 68.67x, which is attractive compared to the industry P/E ratio of 102x.

Given these strong financials, the company’s annualized EPS stands at ₹16.98, and its PE ratio is 46.23x, making the IPO fairly priced with potential for high returns.

Investment Recommendation

With the strong financials, high potential for growth in the aerospace and semiconductor sectors, and an impressive 70.07% GMP, Unimech Aerospace and Manufacturing IPO presents an excellent opportunity for risk-taking investors. Given the company’s consistent financial performance, leadership in the precision engineering space, and positive market sentiment, investors seeking listing gains should consider subscribing to this IPO.

The Upcoming IPOs in this week and coming weeks are Indo Farm, Technichem Organics, Leo Dry Fruits, Solar91 Cleantech, Rosmerta Digital and Avanse Financial.

 and .The Current active IPO is Citichem IndiaAnya Polytech