Introduction
The Indian IPO market is experiencing a high level of activity. Every month, numerous companies initiate initial public offerings (IPOs) to obtain funding from the general public. Investors closely monitor these IPOs as they offer an opportunity to invest in promising companies across various sectors and enhance their financial assets.
Keep an eye on the upcoming IPO of Cyient DLM Ltd. Continue reading to discover the different facets of the Cyient DLM Ltd IPO, which will be available for subscription starting from June 27th.
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About Cyient DLM Ltd IPO
Cyient DLM Ltd is one of India's foremost electronics and mechanical manufacturing partners and systems suppliers to various industries. It has a rich legacy of over two decades and in-depth expertise in designing and precisely manufacturing complex products.
The company has three manufacturing facilities with over 22 lakh square feet of floor space. It has a long list of marquee clients, including ABB Inc, Honeywell International Inc, and Bharat Electronics Ltd, among others.
Strengths
- Ability to deliver comprehensive engineering solutions with robust capabilities throughout the entire product value chain
- Robust technical expertise with capabilities in safety-critical electronics
- Strong customer engagements, creating formidable entry barriers
- Highly advanced manufacturing infrastructure, rigorous quality standards, a wide range of in-house capabilities, and a strong and reliable supply chain
- Notable advantage over competitors due to its profound sectoral expertise from promoter Cyient Ltd
Weaknesses
- A major portion of revenues comes from the top 10 customers
- Instances of payment defaults or significant delays by a substantial number of our customers
- Exposure to several risks due to the global nature of business, which could adversely affect cash flow, financial conditions, and operations
- Fluctuation in foreign exchange could adversely impact earnings
Financial Snapshot Of Cyient DLM LTD
Cyient DLM Ltd's financial performance showcases a commendable track record of profitability and financial health. Over the years, the company has efficiently managed its resources and executed strategic initiatives, resulting in a positive bottom line. Its financial statements reveal healthy revenue figures, indicating a solid market presence and consistent customer demand for its services.
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The company's revenue growth has been notable, with steady increases in sales and turnover. This growth is a testament to Cyient DLM Ltd's ability to capture market opportunities, successfully deliver on client requirements, and stay ahead of the competition. Through its diversified portfolio of services and solutions, the company has been able to cater to various industries and markets, further bolstering its financial strength.
Given below are the company's financials as per the red herring draft prospectus:
| Particulars |
For the Period Ending September 30, 2022 |
As of and For FY Ending March 31 |
| 2022 |
2020 |
2021 |
| Share Capital |
3 |
1 |
1 |
1 |
| Networth |
179 |
77 |
38 |
26 |
| Total Borrowings |
308 |
293 |
234 |
261 |
| Revenue from Operations |
340 |
721 |
628 |
457 |
| Profit After Tax |
13 |
40 |
12 |
-7 |
| Earnings per Share (diluted) |
4.61* |
16.17 |
4.8 |
-2.72 |
| Net asset value (In Rs/share) |
62 |
31 |
15 |
10 |
| Return on Net worth (%) |
7.50% |
52% |
31% |
-26% |
Amount in Cr except per share
*not annualised
Cyient DLM Ltd IPO Details
|
IPO Date
|
27th June 2023 to 30th June 2023 |
| Listing At |
BSE, NSE |
| Face Value |
Rs 10 per share |
| Price |
Rs 250 to Rs 265 per share |
| Lot Size |
56 shares |
| Total Issue Size |
2,23,39,623 shares |
| (aggregating up to Rs 592 Cr) |
| Fresh Size |
2,23,39,623 shares |
| (aggregating up to Rs 592 Cr) |
| Issue Type |
Book Built Issue IPO |
| Shareholding pre-issue |
5,69,41,471 |
| Shareholding post issue |
7,92,81,094 |
| Employee Discount |
Rs 15 per share |
| Retail Allocation |
10% |
With the proceeds received from the IPO, the company plans to:
- Fund its working capital needs
- Carry out other general corporate work
Essential Things to Consider Before Subscribing to This IPO
As an investor, you can consider investing in Cyient DLM Ltd IPO because it is a prominent global Electronics Manufacturing Services (EMS) company. With its extensive experience and expertise, the company has established a strong position in the global EMS market, providing tailored solutions to meet the diverse needs of its clients.
According to a Frost and Sullivan report, Cyient DLM Ltd. has recorded the highest margin among its Indian EMS peers. This indicates the company's ability to effectively manage costs, optimize operational efficiency, and generate healthy profits. The high margin suggests that the company has a competitive advantage in terms of pricing, profitability, and financial performance compared to its industry counterparts.
The EMS sector in India has been witnessing phenomenal growth, with a compound annual growth rate (CAGR) of 32.3%, making it the fastest-growing EMS market among all countries. By investing in Cyient DLM Ltd., you can tap into this growing sector and benefit from its potential for expansion. If you want to subscribe to this IPO, open your Demat account with Motilal Oswal today.
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