Milestone Gears IPO Blast! ₹1,100 Cr Mega Deal Filed – Could This Be Your Next Big Investment?

Milestone Gears Limited is preparing to enter the stock market with a substantial Initial Public Offering (IPO) aimed at raising ₹1,100 crore. The company has filed its Draft Red Herring Prospectus (DRHP) with the relevant authorities, marking a crucial step towards becoming a publicly listed entity.

The proposed IPO includes both a fresh issue of equity shares, which will bring new capital into the company, and an offer for sale, allowing existing promoter shareholders to divest a portion of their holdings.

Company Profile

Milestone Gears specializes in the manufacturing and supply of transmission components and auto parts. The company has established a reputation for its expertise in producing high-precision gears.

• It leverages advanced technologies, including 5-axis CNC gear analyzers and optical measuring systems, to ensure the highest standards of accuracy and quality in its products.
• This focus on precision and advanced manufacturing makes Milestone Gears a key player in the auto ancillary sector.

IPO Details

The company plans to raise a total of ₹1,100 crore through this public offering.

• The funds raised from the fresh issue are typically intended for business expansion, debt reduction, or working capital needs.
• The offer for sale component allows promoters to monetize their investment.

Legal and Advisory Teams

Several legal firms are advising on this significant transaction.

• Khaitan & Co is advising Milestone Gears Limited. The transaction team was led by Partners Gautham Srinivas and Sathvik Ponnappa, with support from Principal Associate Sanjeev Chowdhary and Associates Mainak Pani, Vidushi Tanya, Aditi Dubey, Harshitha Kiran, and Anushaka Sharma.
• Trilegal is advising the book running lead managers (BRLMs): JM Financial, Axis Capital, and Motilal Oswal Investment Advisors. The team was led by Partner Albin Thomas, with support from Counsel Malika Grewal and Associates Janhavi Shah, Kavya Krishnaswamy, Adhish Mohanty, and Sanskriti Singh.
• Hogan Lovells acted as international legal counsel for the BRLMs. The team was led by Biswajit Chatterjee (Head of India Practice and Dubai Office Managing Partner), supported by Counsel Kaustubh George and Associates Aditya Rajput and Purva Mishra.

Importance for Investors

This IPO presents a new investment opportunity in the auto ancillaries space.

• Investors can evaluate Milestone Gears' business model, growth prospects, and financial health as part of their due diligence.
• The successful listing could enhance the company's visibility and access to capital for future growth.

Impact

• This IPO could lead to increased competition and innovation within the auto components sector in India.
• It offers investors a chance to participate in the growth story of an Indian auto parts manufacturer.
• Impact Rating: 7/10

Difficult Terms Explained

• Initial Public Offering (IPO): The first time a private company offers its shares to the public, allowing it to raise capital by selling stock.
• Draft Red Herring Prospectus (DRHP): A preliminary document filed with the market regulator (like SEBI in India) before an IPO, containing detailed information about the company and the offer.
• Fresh Issue: The issuance of new shares by a company to raise capital from the public.
• Offer for Sale (OFS): Existing shareholders (like promoters) sell their shares to new investors as part of the IPO.
• Promoter Selling Shareholders: The individuals or entities who founded or control the company and are selling a portion of their shares during the IPO.
• Book Running Lead Managers (BRLMs): Investment banks that manage the IPO process, underwrite the shares, and market the offering to investors.