Gala Precision Engineering Gears Up for IPO, Eyes Growth in Precision Component Market

19 Feb 2024 , 08:55 AM

Maharashtra-based Gala Precision Engineering is gearing up to raise funds through an initial public offering, having filed preliminary papers with the capital markets regulator SEBI.

The IPO, consisting of 31,74,416 equity shares, comprises a fresh issue of 25,58,416 equity shares by the company, along with an offer-for-sale of 6,16,000 equity shares by existing shareholders, as disclosed in the filing with SEBI on February 14.

Promoter Vishanji Harshi Gala will be the principal selling shareholder in the offer-for-sale, divesting 3,85,200 equity shares. Additionally, the remaining 2,30,800 equity shares will be sold by Kirit Vishanji Gala (HUF), Nayna Gala, Satish Kotwani, Hemlata Dhiraj Shah, Dhiraj Nanchand Shah, Urmil Dhiraj Shah, and Rupa Sunil Mehta.

The promoters currently hold a 74.56% stake in the company, while the remaining shares are owned by the public, including Pooja Unichem LLP.

Gala Precision Engineering, which specializes in manufacturing precision components such as disc and strip springs (DSS), plans to utilize Rs 37 crore of the IPO proceeds to establish a new facility in Sriperumbuddur, Tamil Nadu. This facility will focus on the production of high tensile fasteners and hex bolts.

The company’s DSS products find application across various sectors, including renewable energy, railways, automobiles, off-highway vehicles, heavy machinery, and electrical and power equipment. Gala boasts a significant market presence in the DSS segment for the renewable energy industry, with a 70% share in the domestic market and a 3% share globally.

PL Capital Markets has been appointed as the sole merchant banker to the issue.