Auto component manufacturer GNA Axles Limited has initiated its initial public offering (IPO) plans by filing a red herring draft prospectus (DRHP) with the Securities Exchange Board of India (SEBI). According to the prospectus, a total of 63 lakh equity shares will be sold through the IPO at a price which will be decided later. Out of the 63 lakh shares, GNA has reserved 2-lakh shares for its existing employees. The shares will be listed on NSE and BSE. The IPO will comprise of 29.35% of post-issue paid-up capital of the company.
Promoters of GNA Axles are Jasvinder Singh Seehra, Ranbir Singh and Gurdeep Singh. The company has roped two banks: PNB Investment Services Limited and Ambit Corporate Finance Private Limited, as its book running lead managers. Link Intime India Private Limited is serving as Registrar to the issue.
Purpose of the Issue
Proceeds from the issue will be utilized for acquiring plant and machinery, meet working capital requirements and general corporate purpose. Sum of INR80.07 crore is allocated for purchasing plant and machinery and INR35 crore is kept for working capital requirements.
Background of GNA Axles
Incorporated in 1993, this Punjab-based company is one of the leading manufacturers of rear axle shafts for agricultural and commercial vehicles. GNA has two manufacturing units in Kapurthala and Hoshiarpur with production for on-highway and off-highway vehicular segments including HCV, MCV, LCV tractors and machinery.
For fiscal year 2015, GNA Axles earned INR430.6 crore as revenue and INR21.6 crore as net profit. Domestic sales and exports accounted for 51.67% and 48.33% respectively in the latest FY.
GNA boasts of a broad customer base in India and overseas. Its customers include original equipment manufacturers like Mahindra & Mahindra Limited, Tractors and Farm Equipment Limited (TAFE) and John Deere. GNA serve as tier-1 supplier for companies like Transaxle Manufacturing of America, Kubota Corporation Meritor HVS AB, Dana Limited and Automotive Axles Limited. GNA also exports equipment to abroad locations including USA, UK, China, Japan, Germany, France, Australia, Sweden, Italy, Turkey and Spain.