Sona Comstar Retail book fully

Sona Comstar Retail book fully subscribed on Day 2

Sona BLW Precision Forgings Limited (Sona Comstar), one of India’s leading automotive technology companies; received bids of 2,91,25,182 shares against the offered 10,71,05,262 equity shares, as per the 5:00 pm data available on the bourses.

The portion reserved for retail investors was subscribed 1.02 times. While the Qualified Institutional Buyer category was subscribed 0.14 times, the Non-Institutional Investor category was subscribed 0.04 times. 

The total size of the offer is Rs. 5,250 crores at the upper price band of Rs. 291 per share.

The Company raised Rs. 2,498 crores through 42 anchor investors.

Key brokerage houses like Angel Broking, Canara Bank Securities, Motilal Oswal, ICICI, Nirmal Bang Hem Securities, IndSec Securities and Ventura have given recommendations of "Subscribe" to the issue for long term perspective while highlighting the key strengths of the company like strong clientele, niche diversified and high margin product portfolio. derives ~40% of its revenues from high growth areas like Battery Electric Vehicles (BEV) and Hybrid Vehicles. It is among the top 10 players globally for differential bevel gears and for starter motors for the PV segment. 

It had 5% market share for differential bevel gears, 3% for starter motors and 8.7% for BEV differential assemblies. They have a diversified customer base across the globe with 75% of their income (sale of goods, FY21) coming from end-use in overseas markets. Emphasis on R&D is one the strongest aspects of the company. With EV’s gaining ground with Sona Comstar is poised to gain from this segment. Also, it has never lost any customers since its inception.

Kotak Mahindra Capital Company Limited, Credit Suisse Securities (India) Private Limited, JM Financial Limited, J.P. Morgan India Private Limited and Nomura Financial Advisory and Securities (India) Private Limited are the Book Running Lead Managers (“BRLMs”) to the Offer.

Company Information

Sona Comstar, a Blackstone backed company, is primarily engaged in designing, manufacturing and supplying highly engineered, mission critical automotive systems and components to automotive OEMs. Sona Comstar is a leading supplier to the fast-growing global Electric Vehicle (EV) markets and derived 13.8% revenue from the Battery EV market and 26.7% from the Micro Hybrid / Hybrid market in FY21. Its global market share of BEV differential assemblies in calendar year 2020 was 8.7%. 

The company is among the top ten players globally in the differential bevel gear market and in the starter motor market on the basis of respective volumes supplied to its end segments in calendar year 2020 and has been gaining global market share across products. According to the Ricardo Report, it serves 6 of the top 10 global PV OEMs, 3 out of top 10 global CV OEMs and 7 out of top 8 global tractor OEMs by volumes. 

The company has strong R&D, engineering and technological capabilities in precision forging, mechanical and electrical systems, as well as base and application software development. It is diversified across geographies, products, vehicle segments and customers. 

According to the Crisil Report, the company has the highest operating EBITDA margin, PAT margin, ROCE and ROE in FY20 as compared to top 10 listed auto component manufacturers in India by market capitalization and has consistently delivered more than 26% EBITDA margin and more than 35% average ROE each year over FY19-21. Its operating income growth over FY16-20 has exceeded the average of the same peer set.

Grilled to Perfection: Barbeque Nation subscribed 5.98 times

 Grilled to Perfection: Barbeque Nation subscribed 5.98 times overall

Barbeque-Nation Hospitality Limited, one of India’s leading casual dining restaurant chains (in terms of outlet count as on September 30, 2020) as per Technopak Report; received bids of 2,99,01,510 shares against the offered 49,99,609 equity shares, as per the 5:00 pm data available on the bourses.

The portion reserved for retail investors was subscribed 13.13 times. While the Qualified Institutional Buyer category was subscribed 5.11, the Non-Institutional Investor category was subscribed 3.10 times.  The employee category was subscribed 1.02 times.

 

While Prabhudas Lilladher and Nirmal Bang who recommended to subscribe to the issue basis the brand’s robust revenue growth and consistent progress in covers other well established brokerage houses like Kotak Securities, ICICI Direct, Angel Broking, Equirius, Ventura have highlighted positive aspects of the Company like widely recognized restaurant brand, strong emphasis on customer experience, pioneering the ‘Over The Table Barbeque' concept, integrated digital ecosystem for app and reservations, consistent cover growth in recent fiscals, strong presence in the Indian market and value-oriented business culture amongst others.

 

 

(Subscription Table Below)

 

With the reducing COVID cases in the country, progress made in vaccine development, clubbed with government official data indicating that India might have reached the peak of COVID 19 cases, opening up of economy is expected in the near future. It is estimated that by Q2 FY 2022, the Food Services Market is expected to regain almost 99% of the market on a base of 2020 and by Q3 and Q4 it is estimated to be 110% of the base of FY2020.

 

The IPO was a fresh issuance of equity shares of Rs 5 face value, aggregating up to Rs 180 cr and an offer for sale of up to 54,57,470 equity shares of face value of Rs 5 each by the selling shareholders. Equity shares aggregating up to Rs. 2 crore was reserved for eligible employees.

 

As of December 31, 2020, BNHL operated 147 Barbeque Nation restaurants (including opened, temporarily closed and under construction outlets) across 77 cities in India and six international Barbeque Nation restaurants across three countries namely UAE, Oman and Malaysia. The company diversified its offering by acquiring 61.35% stake (on a fully diluted basis) in Red Apple Kitchen Consultancy Private Limited which currently owns and operates Italian restaurants under the brand name “Toscano”, a casual dining Italian restaurant chain operating in Pune, Bengaluru and Chennai, “La Terrace” and “Collage”. It further extended its offerings by introducing UBQ by Barbeque Nation to provide a-la-carte Indian cuisine in the value segment and has also launched “Barbeque-in-a-Box” “Grills in a Box” “Meals in a Box” in June 2020 as delivery offerings.