Bangaluru-based precision engineering company Unimech Aerospace and Manufacturing Ltd has received regulatory approval to go ahead with its plans to launch an initial public offering (IPO).
The Securities and Exchange Board of India (SEBI) issued its observations, which are akin to its approval, on Unimech’s IPO proposal on Nov. 21. The capital markets regulator also separately approved on Nov. 22 the IPO proposal of real estate developer Kalpataru Ltd, which aims to raise Rs 1,590 crore through a fresh issue of shares.
Unimech, which is backed by Steadview Capital, private equity firm Evolvence India and the ValueQuest Scale Fund, is set to raise Rs 500 crore via its IPO, which is a combination of a fresh issue of shares and an offer-for-sale of Rs 250 crore. The company’s promoters will be trimming their stake via the offer for sale.
Unimech specializes in making complex products for the aerospace, defence, energy and semi-conductor industries. It makes high-precision tooling for aero engines and airframes, and complex high-precision components, assemblies and electromechanical turnkey systems. It submitted its draft IPO papers in August.
In July, the company said it had raised $30 million, or about Rs 250 crore, from private equity investors in its first external funding round since setting up shop eight years back. The money was raised at a post-money valuation of Rs 3,250 crore, VCCircle reported at the time. It had said it planned to use the fresh money to grow its business and for innovation in the areas it operates in.
The proceeds from the fresh issue of shares in the IPO will be used to buy machinery and equipment, meet working capital needs and to repay debt.
According to VCCEdge, the data research platform of VCCircle, Unimech Aerospace clocked Rs 98.6 crore in consolidated revenue from operations in FY23 and Rs 36.2 crore the year before.
The funding round in July valued the company at 15x its FY24 revenue on a pre-money basis and 33-37x its operating profit, the VCCircle report had said.
Steadview Capital, which manages $2.7 billion in assets, is a London-based but India-focused alternative investment firm whose portfolio includes the likes of Astral Ltd, Dixon Technologies, Nykaa, Lenskart and Dream11. Evolvence India, which has an AUM of $800 million, is a PE firm that counts among its portfolio names such as InfraMarket, Dunzo, Veritas Finance, Rebel Foods and Healthians.
The ValueQuest Scale Fund has been floated by Mumbai-based ValueQuest, which has an AUM of $1.8 billion. The fund, which was ValueQuest’s first PE vehicle, was launched last year with a target of raising Rs 1,000 crore and a greenshoe option of Rs 300 crore. It counts among its portfolio companies Sabine Hospital and solar cell maker Jupiter International.