Aurangabad-based auto component maker LAPL Automotive will launch its Rs 32.4 crore IPO on August 6, with a price band set at Rs 88-94 per share. The company plans to use the funds to build a new manufacturing plant and pay off debt after reporting a 71.4% profit jump in FY26.
LAPL Automotive is set to enter the capital markets with its initial public offering (IPO) opening for subscription on August 6, 2026. The company, which manufactures auto components like lighting systems and mirrors, aims to raise Rs 32.4 crore through a fresh issue of 34.46 lakh shares. Investors can subscribe to the issue until August 10, with the shares expected to list on the BSE SME platform on August 13.
Use of IPO Funds and Expansion
A significant portion of the money raised, approximately Rs 19.56 crore, is dedicated to setting up a new manufacturing unit. This facility will focus on expanding the company’s capacity for automotive lighting, electrical accessories, and electronic components. Beyond infrastructure, LAPL Automotive intends to use Rs 4.8 crore to reduce its debt burden. The company is also moving toward in-house production for certain raw materials that it currently buys from outside vendors. This strategy aims to improve control over production costs and potentially support profit margins in the long run.
Financial Growth and Business Model
For the fiscal year ending March 2026, the company reported revenue of Rs 93.3 crore, marking a 41.3% growth compared to Rs 66 crore in the previous year. Profitability also saw a sharp increase, rising 71.4% to Rs 8.6 crore from Rs 5.03 crore in FY25. The company operates under two models: Original Design Manufacturing (ODM), which brought in 78% of its revenue in FY26, and Original Brand Manufacturing (OBM), which contributed the remaining 22%. The current operations are supported by three existing facilities in Aurangabad.
Things for Investors to Consider
When evaluating an SME IPO, investors should be aware that these companies often have higher risks related to liquidity and scale compared to larger mainboard companies. The success of LAPL Automotive’s expansion depends on its ability to execute the new manufacturing project without delays or cost overruns. Additionally, as an auto component supplier, the company's performance is closely linked to demand trends within the automotive sector. While the company is using a portion of the IPO proceeds to pay down debt, the remaining financial obligations and the impact of the new capital spending on cash flow will be key points for investors to monitor in the coming quarters. The final outcome for shareholders will depend on whether the increased capacity leads to sustained revenue growth and efficient operational management in a competitive market.