Get ready to buy a stake into India's agricultural equipment sector as Indo Farm Equipment Limited gears up for its market debut. This powerhouse manufacturer, known for its robust tractors, versatile pick and carry cranes, and cutting-edge harvesting equipment, is launching an IPO that promises to make waves in the investment community. The company is offering a substantial ₹260.15 crore opportunity, structured as a perfect blend of fresh equity and strategic share sales, demonstrating their commitment to sustainable growth and market expansion.
Investors looking to be part of this agricultural equipment manufacturer can mark their calendars for December 31, 2024, through January 2, 2025. The thoughtfully designed IPO structure includes a fresh issue of 0.86 crore shares worth ₹184.90 crores, complemented by an offer for sale of 0.35 crore shares at ₹75.25 crores. With an investor-friendly price band of ₹204 to ₹215 per share and an accessible lot size of 69 shares, retail investors can join this journey for just ₹14,835 – a modest ticket to what could be a significant growth story. The company aims to complete share allotment by January 3, 2025, with the grand listing ceremony scheduled for January 7, 2025, on both the BSE and NSE. As the agricultural sector continues to modernize, early investors in Indo Farm Equipment Limited might find themselves at the forefront of India's farming sector – don't let this opportunity pass you by.
Indo Farm Equipment Limited IPO is a fundraise worth ₹260.15 crores comprising fresh issue of 0.86 crore shares and offer for sale of 0.35 crore shares. The IPO will be available for subscription from December 31, 2024, to January 2, 2024, providing an opportunity for investors looking to gain a stake in the harvesting equipment space.
| Indo Farm Equipment IPO Date | December 31, 2024 - January 2, 2025 |
| Price Band | ₹204 to ₹215 per share |
| Face Value | ₹10 per share |
| Lot Size | 69 shares |
| Issue Type | Book-built issue IPO |
| Fresh Issue | 86,00,000 shares amounting to ₹184.90 crores |
| Offer for Sale | 35,00,000 shares, amounting to ₹75.25 crores |
| Total Issue Size | 1,21,00,000 shares, amounting to ₹260.15 crores |
| Listing at | BSE, NSE |
| Share Holding Post Issue | 4,80,51,600 |
| Share Holding Pre Issue | 3,94,51,600 |
The Indo Farm Equipment IPO opens for subscription on December 31, 2024, and closes on January 2, 2025, with allotment slated for January 3, 2025.
| IPO Open Date | December 31, 2024 (Tuesday) |
| IPO Close Date | January 2, 2025 (Thursday) |
| Basis of Allotment | January 3, 2025 (Friday) |
| Initiation of Refunds | January 6, 2025 (Monday) |
| Credit of Shares to Demat Account | January 6, 2025 (Monday) |
| Listing Date on Exchanges | January 7, 2025 (Tuesday) |
| Cut-off Time for UPI Mandate Confirmation | 5 PM on January 2, 2025 (Thursday) |
Indo Farm Equipment Limited, established in 1994, has emerged as a significant player in India's agricultural and construction equipment sector through its two flagship brands - Indo Farm and Indo Power. Operating from a sprawling 127,840 sq. meter facility in Baddi, Himachal Pradesh, the company manufactures a diverse range of products including tractors (16 HP to 110 HP) and pick and carry cranes (9 to 30 tons), with an impressive annual production capacity of 12,000 tractors and 1,280 cranes. Their comprehensive facility houses a captive foundry, machine shop, and specialized assembly units, enabling end-to-end manufacturing control.
The company has built a strong international presence, exporting their equipment to several countries including Nepal, Syria, Sudan, Bangladesh, and Myanmar. With an eye on expansion, they have already secured additional industrial land adjacent to their current facility to establish a new pick and carry crane manufacturing unit, which aims to boost their crane production capacity by 3,600 units annually. As of June 2024, the company maintains a robust workforce of 938 employees, underlining their significant operational scale and growth trajectory.
Indo Farm Equipment Limited plans to strategically deploy its fresh IPO proceeds across four key initiatives: establishing a new dedicated manufacturing unit to expand their pick & carry crane production capacity, optimizing their financial structure through debt repayment or pre-payment, strengthening their NBFC subsidiary Barota Finance Ltd. by enhancing its capital base for future growth, and allocating funds for general corporate purposes. This multi-pronged approach aims to simultaneously boost manufacturing capabilities, improve financial health, and support their financing arm's expansion, positioning the company for sustainable long-term growth in both their core equipment business and complementary financial services segment.
The Indo Farm Equipment Limited IPO showcases a healthy market capitalization of ₹1,033.11 crores as on March 31, 2024. Key performance indicators reflect the company's financial health, with a Return on Equity (RoE) of 5.13%, Return on Capital Employed (RoCE) of 8.96%, and Debt-to-Equity ratio of 0.01.
The Return on Net Worth (RoNW) stands at 4.92%, while the Price-to-Book Value (P/BV) is seen at 2.55. The PAT Margin is 4.16. On an annual basis, the company's Profit After Tax (PAT) grew by 1% while the revenue increased by 1% in the financial year ending on March 31, 2024. A comparison of earnings per share (EPS) reveals a pre-IPO EPS of ₹3.95 while it is ₹2.04 post-IPO and the pre-IPO price to earnings ratio is 54.39 while it is 105.25 post-IPO.
| Period Ended | June 30, 2024 | March 31, 2024 | March 31, 2023 | March 31, 2022 |
| Revenue | 75.54 | 375.95 | 371.82 | 352.52 |
| Assets | 644.27 | 647.95 | 622.84 | 619.83 |
| Net Worth | 342.25 | 317.06 | 290.37 | 274.80 |
| Profit After Tax | 2.45 | 15.60 | 15.37 | 13.72 |
| Total Borrowing | 245.36 | 270.54 | 280.65 | 275.00 |
Amount in ₹ crores
Indo Farm Equipment Limited showcases significant operational strengths through its fully integrated manufacturing setup in Baddi, spanning 127,840 square meters, where they produce over 330 tractor components and 190 crane components in-house. This vertical integration, coupled with their ISO 9001:2015 certified facilities and in-house R&D center, enables better cost control, consistent quality, and technological innovation, including proprietary designs for re-entrant combustion chambers that improve fuel efficiency.
The company has built a comprehensive ecosystem that combines manufacturing expertise with financial services through their NBFC subsidiary, Barota Finance Limited, which manages a loan portfolio of Rs. 1,271.55 million serving over 5,900 customers. Their product range is impressively diverse, with tractors ranging from 16 HP to 110 HP and cranes from 9 to 30 tons, meeting approximately 80% of global market requirements. This broad portfolio, along with their established presence in multiple international markets including Europe, Africa, and Asia, demonstrates strong market adaptability and global acceptance.
The company faces significant concentration risks, with over 60% of revenue generated from just five states and heavy dependence on tractors (52.16%) and pick-and-carry cranes (47.77%) for revenue. Their financial metrics raise concerns, with a relatively low net profit margin of 3.5% compared to peers and a lengthy working capital cycle of 270 days, indicating potential cash flow challenges. Additionally, the company operates without long-term supplier contracts, making them vulnerable to raw material price volatility and supply chain disruptions.
The business operates in a highly competitive market dominated by larger players like Mahindra and Escorts, while facing multiple regulatory and compliance risks. Their substantial indebtedness, exceeding ₹2,453.63 million as of FY24, limits financial flexibility, and ongoing legal proceedings involving various stakeholders expose them to potential liabilities. The company's heavy dependence on external factors such as government policies, agricultural subsidies, diesel prices, and bank credit availability makes them susceptible to macroeconomic fluctuations and seasonal demand variations.
The Indo Farm Equipment Limited IPO opens a gateway into India's growing agricultural mechanization sector. As a manufacturer of tractors, cranes, and harvesting equipment, the company is well-positioned to capitalize on increasing farm modernization demands. While the ₹260.15 crore offering presents an intriguing opportunity, investors should carefully evaluate the company's market position, financial health, and growth potential against sector-specific risks like monsoon dependency and policy changes. Before participating in this IPO, consider if Indo Farm's business fundamentals and expansion plans align with your investment strategy and risk tolerance.
What is the Indo Farm Equipment Limited IPO?
The Indo Farm Equipment Limited IPO is a main-board offering consisting of a fresh issue of 0.86 equity shares and an offer for sale of 0.35 crore shares with a face value of ₹10, aiming to raise a total of ₹260.15 crores. The share price is set between ₹204 and ₹215, with a minimum order quantity of 69 shares. This IPO will be open for subscription from December 31, 2024, to January 2, 2025. Mas Services Limited is the registrar while Aryaman Financial Services Limited are the book-running lead managers.
When will the Indo Farm Equipment IPO open?
The Indo Farm Equipment Limited IPO will open for subscription on December 31, 2024, and will close on January 2, 2025.
When is the Indo Farm Equipment IPO listing date?
The tentative listing date for the Indo Farm Equipment Limited IPO is Tuesday, January 7, 2024.
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