Aeroflex Industries Ltd, a Mumbai-based company and a subsidiary of Sat Industries, has secured approval from the Securities and Exchange Board of India (SEBI) to proceed with its initial public offering (IPO). The company had filed its Draft Red Herring Prospectus (DRHP) with SEBI in April to raise approximately ₹350 crores through the IPO.
The IPO comprises a fresh issue of equity shares worth up to ₹160 crores and an offer-for-sale (OFS) of up to 1.75 crore equity shares by the promoters, selling shareholders, and promoter group. Each equity share will have a face value of ₹2.
“We have been informed by Aeroflex Industries Limited, our subsidiary, that it has received clearance from the Securities and Exchange Board of India (SEBI) for its initial public offer (IPO) subject to submission of requisite documents as per the final observation letter dated 31st July 2023,” stated Sat Industries in an exchange filing. The company may offer a discount to eligible shareholders of Sat Industries Ltd, its promoter and a listed entity on the stock exchanges, in consultation with the book-running lead manager (BRLM).
The IPO proceeds will be utilized for debt repayment, meeting working capital requirements, and setting aside funds for general corporate purposes and potential acquisitions for inorganic growth, as per the DRHP.
Pantomath Capital Advisors Private Ltd is the sole book-running lead manager for the IPO, while Link Intime India Private Ltd will act as the registrar. Following the IPO, Aeroflex Industries’ shares will be listed on both the BSE and NSE.
The IPO will follow the book-building process, with at least 15% of the offer reserved for non-institutional investors and a minimum of 35% for retail individual investors. Qualified institutional buyers may be allocated up to 50% of the offer, while the shareholders of Sat Industries Ltd may receive up to 10% of the offer.
According to the DRHP, the company’s consolidated revenue from operations in fiscal year 2022 amounted to ₹240.8 crore, with earnings before interest, taxes, depreciation, and amortization (EBITDA) reaching ₹46.7 crore and an EBITDA margin of 19.4%. The company’s profit after tax (PAT) for the same fiscal year was ₹27.5 crore, with a PAT margin of 11.4%. The IPO is expected to support the company’s growth plans and enhance its financial position for future expansion and development.