ASK Automotive Limited is launching its IPO. The IPO opens for subscription on November 7, 2023, and will close on 9th November.
What does ASK Automotive do?
Incorporated in 1988 ASK Automotive specializes in manufacturing advanced braking systems and precision-engineered components for two-wheelers. The company’s product portfolio includes:
- Advanced Braking Systems (ABS): Offering a variety of braking components like brake panel assembly, brake shoes, and disc brake pads suited for motorcycles, scooters, and other vehicle segments.
- Aluminium Lightweight Precision Solutions (ALPS): Producing engine parts, body and chassis components, and transmission parts for both internal combustion engine vehicles and electric vehicles.
- Wheel Assembly: This provides complete wheel solutions to OEMs, catering to a diverse range of two-wheelers.
- Safety Control Cables (SCC): Manufacturing crucial control cables including throttle, brake, and clutch cables necessary for vehicle safety and functionality.
The company operates 15 manufacturing facilities in India, catering to a wide market that includes major Original Equipment Manufacturers like Honda Motorcycle and Scooter India, Hero MotoCorp, Suzuki, TVS, Yamaha, and Bajaj, while also serving aftermarket needs and exporting globally.
What is the issue size of the ASK Automotive IPO?
The company’s entire public offering is an offer for sale (OFS) worth Rs. 834 crores from existing shareholders.
Financials of ASK Automotive
| Financial Year | Total Assets (₹ crores) | Total Revenue (₹ crores) | Profit After Tax (₹ crores) | EPS | EBITDA (₹ crores) |
|---|---|---|---|---|---|
| March 31, 2021 | 948.25 | 1,567.77 | 106.20 | 5.22 | 210.112 |
| March 31, 2022 | 1,105.56 | 2,024.26 | 82.66 | 4.09 | 182.258 |
| March 31, 2023 | 1,281.21 | 2,566.28 | 122.95 | 6.18 | 247.545 |
| June 30, 2022 | 1,176.46 | 603.73 | 22.55 | 1.12 | 51.735 |
| June 30, 2023 | 1,443.34 | 657.55 | 34.83 | 1.77 | 64.744 |
Risk factors to consider:
Offer for Sale: The company will not receive any proceeds from the Offer for Sale, as it is a sale by existing shareholders.
Two-Wheeler Sector Dependence: The company’s revenue is highly reliant on the Indian two-wheeler automotive sector, which makes it vulnerable to sector-specific downturns.
Customer Concentration Risk: With over half of its revenue coming from the top three customers, the loss of any key customer could significantly affect the financial health of the company.
Contract Labour Dependence: The company’s dependence on contract labour could lead to operational disruptions if issues arise in the labour supply chain.
Credit Facilities Risk: The company’s credit facilities are subject to on-demand repayment, posing a liquidity risk if lenders call in these debts unexpectedly.
Raw Material Volatility: The company’s profitability hinges on the cost and availability of raw materials like Aluminum, with no guaranteed supply agreements, making it susceptible to market volatility.
Schedule/Timeline of ASK Automotive IPO
| Issue Period | November 7, 2023, to November 9th, 2023 |
|---|---|
| Price band | ₹ 268 - 282 |
| Minimum Bid quantity | 53 & Multiples thereof |
| Deadline for accepting UPI mandate | 5:00 PM on the issue Closing Date. |
| Finalization of Allotment | November 15, 2023 - Wednesday |
| Initiation of Refunds | November 15, 2023 - Thursday |
| Credit of Shares | November 17, 2023 - Friday |
| Date of Listing | November 20, 2023 - Monday |
| Mandate end date | November 24, 2023 - Friday |
| Anchor Investors Lock-In End Date | December 11, 2023 - Monday |
How to apply for the ASK Automotive Limited IPO?
You can apply for the ASK Automotive Limited using any supported UPI app by following two steps:
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Enter your bid on Kite
-
Accept the UPI mandate on your phone
On acceptance of the mandate, the bid amount will get blocked in your bank account. Click here to learn more.
How to check the allotment status of the ASK Automotive Limited IPO?
You can check the allotment status for the ASK Automotive IPO on the website of the Registrar and Transfer agent. Alternatively, you can also check the allotment status on the NSE website.