Jyoti CNC Automation Files for Rs 1,000-Crore IPO to Fuel Growth

4 Sep 2023 , 09:40 AM

Jyoti CNC Automation, a Gujarat-based computerised numerical control (CNC) machine manufacturer, has taken a significant step towards its expansion plans by submitting draft papers to the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) aimed at raising Rs 1,000 crore.

The IPO exclusively comprises a fresh issue of Rs 1,000 crore, with no offer-for-sale component, as confirmed by the company in the draft red herring prospectus filed with SEBI on September 1. Additionally, Jyoti CNC Automation is contemplating a pre-IPO placement of Rs 200 crore before finalizing the red herring prospectus with the registrar of companies, which will adjust the size of the fresh issue accordingly.

The funds garnered through the IPO will serve various purposes, including the repayment of a Rs 450 crore debt, meeting long-term working capital requirements amounting to Rs 300 crore, and addressing general corporate needs.

Positioning itself as a key player in the global CNC machine industry with the 12th largest market share, Jyoti CNC Automation specializes in delivering tailor-made solutions to sectors such as aerospace and defense, automotive and auto components, general engineering, EMS (Electronics Manufacturing Services), and dies & molds. 

The company proudly boasts a client roster that includes prestigious names like ISRO, BrahMos Aerospace Thiruvananthapuram, Turkish Aerospace, Tata Advances System, Bharat Forge, Shreeram Aerospace & Defence LLP, and Bosch, having supplied over 30,000 CNC machines since April 2004.

Jyoti CNC Automation operates from three manufacturing facilities, with two in Gujarat and one in France. As of June 30, 2023, the company’s order book stood at an impressive Rs 3,143.06 crore. In terms of financial performance, the company recorded a 24.5% year-on-year growth in revenue from operations, reaching Rs 929.3 crore in FY23. Its EBITDA (earnings before interest, tax, depreciation, and amortization) increased by 34% to Rs 97.4 crore, with a margin expansion of 75 basis points, reaching 10.48%, as reported in the draft red herring prospectus.

Equirus Capital, ICICI Securities, and SBI Capital Markets have been appointed as the merchant bankers overseeing the IPO, underscoring Jyoti CNC Automation’s commitment to a successful public offering to propel its future growth endeavors.