NE BUSINESS BUREAU
AHMEDABAD, JUNE 23
Cyient DLM Limited, an integrated electronic manufacturing services (EMS) and solutions company, has set the price band for its ₹592-crore initial public offering at ₹250-265 apiece. The issue will remain open from Tuesday, June 27 and the three-day stake sale will conclude on Friday, June 30 as the markets will observe a holiday on Wednesday, June 28.
Investors must place bids for at least 56 shares and in multiples of 56. The Anchor Investor Bid/Issue Period is one Working Day prior to the Bid/Issue Opening Date, that is, Monday, June 26, 2023.
- Anchor Investor [Bid/Issue Period]– Monday, June 26, 2023
- Bid /Issue Opening Date – Tuesday, June 27, 2023 and Bid/ Issue Closing Date – Friday, June 30, 2023
- Bids can be made for a minimum of 56 Equity Shares and in multiples of 56 Equity Shares thereafter
- The company has undertaken a pre-IPO placement of 40,75,471 equity shares to Amansa Investments at a higher price band of ₹265 apiece amounting to ₹108 crore
Currently, the company has three factories – in Mysuru, Hyderabad and Bengaluru.
“We are not planning to expand our factories in India for now but we are looking for global expansion.” said Rajendra Velagapudi, managing director.
Answering a query on setting up shops in Gujarat, Krishna Bodanapu, Executive Vice-Chairman and Managing Director, said, “Gujarat government offers attractive subsidies for EMS units. We will consider this later as our existing units have adequate manufacturing capacities to meet the increase in domestic and export demands.”
Incorporated in 1993, Cyient DLM provides Electronic Manufacturing Services (EMS) as build to print (B2P) and build to specification (B2S) services, including product design, and flexible manufacturing services tailored to meet their specific requirements.
The company has in consultation with the BRLMs, undertaken a pre-IPO placement of 40,75,471 equity shares to Amansa Investments at a price of ₹265 apiece amounting to ₹108 crore. This has resulted in the reduction in the issue size, which was said at Rs 700 crore earlier. Cyient Ltd holds over 92.84 per cent stake in the Cyient DLM.
Cyient DLM has reserved shares worth ₹ 15 crore for its eligible employees, who will get a discount of ₹ 15 apiece for the issue. Not more than 75 per cent of the net offer is reserved for qualified institutional bidders (QIBs), while non-institutional investors will get 15 per cent of the offer. Retail bidders will be allocated with the remaining 10 per cent of the offer.
Net proceeds from the fresh issue will be utilized towards funding incremental working capital requirements of the company, funding capital expenditure of the company, repayment or prepayment, in part or full, of certain of the borrowings; achieving inorganic growth through acquisitions; and general corporate purposes.
The core solutions provided by Cyient DLM encompass various key components, including printed circuit board assembly, cable harnesses, and box builds. These components play a crucial role in safety of critical systems. and its key customers include Honeywell International, Thales Global Services, ABB Inc, Bharat Electronics, and Molbio 152 Diagnostics among others.
“The revenue growth was 15% last quarter which is quite less compared to our peers. This is because of our constant shift to high quality products.” said Shrinivas Appaji Kulkarni, chief financial officer.
He pointed out that the order book is around Rs 2,400 crore, filled with quality tier-1 clients like Honeywell, ABB, etc, with whom they enjoy sustained and long-standing relationship. “Going forward, you will see our margins sustaining and growing,” he added.
For the year ended on March 31, 2023, Cyient DLM clocked a net profit at ₹31.73 crore with a total revenue at ₹838.34 crore. The company’s net profit stood at ₹ 39.80 crore with a total revenue at ₹ 728.48 crore.
Axis Capital and JM Financial are the book-running lead managers to the issue, while KFin Technologies has been appointed as the registrar to the issue. Shares of Cyient DLM will be listed on both BSE and NSE, which is likely to be scheduled on Monday, July 10.
