Lohia Corp's ₹1,102 crore IPO opens for subscription on July 23 at a price band of ₹404-425 per share. The issue is an Offer for Sale by existing shareholders. Investors can apply for a minimum of 35 shares until July 27, with the company focusing on machinery for technical textiles and woven raffia.
Detailed Coverage
Lohia Corp, a manufacturer of industrial machinery, is launching its Initial Public Offering (IPO) on July 23, with the subscription period closing on July 27. The company has set a price band of ₹404 to ₹425 per share. At the upper end of this band, the company is valued at approximately ₹4,500 crore.
The entire ₹1,102 crore issue is an Offer for Sale. This means all shares sold are held by current investors, and the company will not receive any of the money raised through this public offering. The share allocation is split, with 75% reserved for Qualified Institutional Buyers, 15% for Non-Institutional Investors, and 10% for retail investors. The minimum application size for retail investors is 35 shares.
Financial Context and Valuation
In the financial year ending 2026, the company reported growth in its key financial metrics. Revenue grew by 24.7%, while EBITDA and Profit After Tax (PAT) saw increases of 45.5% and 65.3% respectively. The EBITDA margin stood at 18.6% for FY26. Return on Equity (RoE) and Return on Capital Employed (RoCE) were reported at 38.9% and 42.6%, respectively, for the same period. At the upper price band, the IPO is valued at a Price-to-Earnings (P/E) multiple of 22.1x based on its post-issue earnings. Brokerage reports, such as those from SBI Securities, have pointed to these return ratios and profit growth as key areas of interest for long-term investors.
Business Focus and Market Position
The company specializes in machinery used in the production of woven raffia and technical textiles. Its business model relies on an integrated manufacturing process and an international distribution network. By focusing on both new machinery sales and aftermarket services, the company seeks to maintain its market presence. The growth strategy involves expanding into adjacent segments within the industrial textile machinery sector.
Potential Risks and Monitorables
While the company has shown growth in recent years, investors may track whether it can maintain its margins and market share in a competitive machinery sector. Like many industrial firms, the company is susceptible to fluctuations in raw material costs, which can directly influence profit margins. Additionally, the demand for its machinery is tied to the capital spending cycles of its customers in the textile industry. Any slowdown in global or domestic textile demand could affect future order books and capacity usage. The shares are expected to list on the BSE and NSE on or around July 30. The final performance will depend on the company's ability to continue its operational efficiency and manage costs as it scales its operations.