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ASK AUTOMOTIVE LTD IPO

IPO Details

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53 Shares
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₹ 268 – 282
₹ Up to 834 Cr

Issue timeline

  • -
  • 15-Nov-2023
  • 16-Nov-2023
  • 17-Nov-2023
  • 20-Nov-2023

Subscription Status

Shareholder -
Qualified Institutional Buyers -
Non-Institutional Investor -
Retail Individual Investor -
Employee -
Total -

About Company

- The largest manufacturer of brake-shoe and advanced braking (“AB”) systems for two-wheelers (“2W”) in India (Source: CRISIL Report)
-They have been supplying safety systems and critical engineering solutions for more than three decades with in-house designing, developing and manufacturing capabilities
-They operate 15 manufacturing facilities across five states in India, majority of which are strategically located in close proximity to OEM customers and they are developing one new manufacturing facility in Rajasthan (Source: CRISIL Report).

Strengths & Risks

Strengths (3)

Long-standing customer relationships with both Indian and global OEM players
Their experience in developing complex critical safety systems and solutions has led to established relationships with several customers. Globally, their customers include players such as Stanley Black & Decker, Polaris, and MTD Products. In India, their customers include the top six 2W OEMs (in terms of production volume and value for Fiscal 2022) (Source: Company DRHP)

Risks (2)

May not be successful in implementing their growth strategies
Their growth strategy includes strengthening their position in the evolving EV sector in India, deepening, diversifying and expanding their customer base by expanding product portfolio. There can be no assurance that their limited experience will result in sale of products at a comparable scale in the future as the market for EVs is relatively new, rapidly evolving, and is characterized by rapidly changing technologies, price competition, additional competitors, evolving government regulation and industry standards, and frequent new vehicle announcements (Source: Company DRHP)

  • Long-standing customer relationships with both Indian and global OEM players
    Their experience in developing complex critical safety systems and solutions has led to established relationships with several customers. Globally, their customers include players such as Stanley Black & Decker, Polaris, and MTD Products. In India, their customers include the top six 2W OEMs (in terms of production volume and value for Fiscal 2022) (Source: Company DRHP)

  • Financial and return metrics demonstrating growth and efficient use of capital
    Their revenue from operations has grown at a CAGR of 28.64% between Fiscals 2021 and 2023, demonstrating growth in financial performance in recent years, and positioning them for future growth and further diversification of their customer base and offerings.(Source: Company DRHP)

  • Robust production model driven by research and development (“R&D”)
    They have R&D, engineering and technological capabilities to offer future-ready solutions and customized solutions to cater to customers’ needs. They have undertaken several R&D driven initiatives, to develop products manufactured for their AB systems, as well as light weighting solutions for products under ALP solutions, enabling customers to capitalize on market growth trends. (Source: Company DRHP)

  • May not be successful in implementing their growth strategies
    Their growth strategy includes strengthening their position in the evolving EV sector in India, deepening, diversifying and expanding their customer base by expanding product portfolio. There can be no assurance that their limited experience will result in sale of products at a comparable scale in the future as the market for EVs is relatively new, rapidly evolving, and is characterized by rapidly changing technologies, price competition, additional competitors, evolving government regulation and industry standards, and frequent new vehicle announcements (Source: Company DRHP)

  • Disruption, slowdown or shutdown of manufacturing facilities may adversely affect business
    Their business is supported by their manufacturing capabilities, comprising 15 manufacturing facilities in India. Their manufacturing facilities and operations are subject to the risks of breakdown and/or failure of equipment, disruption in electrical power or water resources, fire and industrial accidents. Furthermore, any disruptions, damage or destruction of manufacturing facilities may severely affect ability to meet customers’ demand which may lead to loss of any of customers or a significant reduction in demand from such customers. (Source: Company DRHP)

Financials

Total Equity
Total Borrowings
Profit after tax
Earning per share

Industry Overview

- Growing awareness regarding environmental issues: Alarming levels of air pollution among metro cities in India and actions taken by the local governments are resulting in higher awareness levels among masses, especially youth, regarding environmental issues and advantages of EVs in addressing some of these issues. Growing awareness levels and concern regarding environmental issues is therefore likely to be one of the drivers for electrification in India.

 


- Penetration of electric PVs as of Fiscal 2022: EV penetration in the PV category was just 0.6% in Fiscal 2022, due to the unavailability of affordable electric cars and charging stations leading to range anxiety. Overall, EV retail sales stood at 20,525 in Fiscal 2022. (Source: Company DRHP)

- Growing awareness regarding environmental issues : Alarming levels of air pollution among metro cities in India and actions taken by the local governments are resulting in higher awareness levels among masses, especially youth, regarding environmental issues and
advantages of EVs in addressing some of these issues. Growing awareness levels and concern regarding environmental issues is therefore likely to be one of the drivers for electrification in India.
- Penetration of electric PVs as of Fiscal 2022 : EV penetration in the PV category was just 0.6% in Fiscal 2022, due to the unavailability of affordable electric cars and charging stations leading to range anxiety. Overall, EV retail sales stood at 20,525 in Fiscal 2022.(Source: Company DRHP)
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53 Shares

Subscription Status

Shareholder -
Qualified Institutional Buyers -
Non-Institutional Investor -
Retail Individual Investor -
Employee -
Total -

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*The financials mentioned above are sourced from DRHP/ RHP documents.

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