Unimech Aerospace and Manufacturing Ltd, which counts alternative investment firms Evolvence India and Steadview Capital as well as a private equity fund managed by ValueQuest among its backers, made a strong debut on the stock exchanges on Tuesday.
Shares of Bengaluru-based Unimech listed on the Bombay Stock Exchange at Rs 1,491 per share, about 90% higher than its initial public offering price of Rs 787 apiece. The stock pared some of the gains later.
Unimech’s stellar listing gains follow its heavily-subscribed IPO. The Rs 500-crore issue was subscribed over 184x during the IPO that opened for bids on December 23 and closed on December 26.
The company is a manufacturer of complex components for the aerospace, energy and semiconductor industries. It submitted its draft IPO papers in August and received regulatory approval last month.
The company raised Rs 500 crore through a combination of a fresh issue of shares and an offer-for-sale of Rs 250 crore. In the OFS, while the company’s promoters trimmed their stakes while external investors stayed put.
The company had set a price band of Rs 745-785 per share for the IPO, which gave it market valuation of about Rs 3,992 crore, or about $470 million, after accounting for the fresh issue of shares, back-of-the-envelope calculations showed.
Currently, with the stock listing at a premium, it commands a market cap of Rs 6,850 crore, or almost $800 million.
Evolvence, Steadview and ValueQuest Scale Fund had invested a total of Rs 250 crore in Unimech in July this year at a valuation of Rs 3,250 crore. This was the company’s first external funding round since setting up shop eight years ago. Evolvence and ValueQuest invested Rs 100 crore each and picked up a stake of 3.08% each while Steadview pitched in with Rs 50 crore for a 1.54% stake in Unimech.
The three investors, which were sitting at a 15% upside based on the company's IPO price band, are instead now looking at 2x gains, less than six months after making the investment.
Unimech clocked revenue of Rs 208.8 crore for 2023-24, up from Rs 94.17 crore and Rs 36.3 crore in the previous two years. Its earnings before interest, tax, depreciation and amortisation (EBITDA) rose to Rs 79.2 crore from Rs 34.6 crore and Rs 7.7 crore while net profit jumped to Rs 58.1 crore for FY24 from Rs 22.8 crore and Rs 3.4 crore in the previous two years. The IPO had valued the company at 19x its FY24 revenue and 50x its EBITDA.
