Belrise Industries IPO: Should You Subscribe?

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IPO Snapshot

• Issue Size: ₹2,150 crore (Fresh Issue)
• Price Band: ₹85 – ₹90 per share
• Lot Size: 166 shares (Minimum investment: ₹14,940)
• IPO Dates: May 21 – May 23, 2025
• Listing Exchanges: NSE & BSE
• Grey Market Premium (GMP): ~16% (₹13–₹14)

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Company Overview

Belrise Industries, formerly known as Badve Engineering, is a Pune-based automotive component manufacturer. Established in 1996, the company specializes in:

• Product Portfolio:
  • Automotive sheet metal and casting parts
  • Polymer components
  • Suspension and mirror systems
• Market Presence:
  • 15 manufacturing facilities across 8 states in India
  • Exports to countries like Austria, Slovakia, the UK, Japan, and Thailand
  • Clients include Bajaj Auto, Honda Motorcycle & Scooter India, Hero MotoCorp, Jaguar Land Rover, and Royal Enfield Motors

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Financial Highlights

• FY24 Revenue: ₹7,484.2 crore (13.7% YoY growth)
• FY24 Net Profit: ₹310.9 crore (0.9% decline YoY)
• EBITDA Margin: 12.35% (down 95 bps)
• Q1 FY25 Revenue: ₹1,781 crore
• Q1 FY25 Net Profit: ₹71.6 crore

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Use of IPO Proceeds

• Debt Repayment: ₹1,618 crore (62.5% of total borrowings)
• General Corporate Purposes: Remaining funds

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Key Strengths

• Strategic Acquisition: Acquired H-One India to enhance manufacturing and design capabilities, particularly in high-tensile steel components
• Strong Client Base: Long-standing relationships with major OEMs
• Export-Oriented: Significant revenue from international markets

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Risks & Concerns

• Declining Margins: EBITDA margins have been decreasing over the past two years
• High Debt Levels: Debt-equity ratio is higher compared to some peers
• Profitability Pressure: Slight decline in net profit despite revenue growth

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Expert Opinions

Market analysts suggest that while the IPO is priced attractively compared to peers, investors should consider the company’s declining margins and high debt levels. The positive GMP indicates favorable market sentiment, but it’s advisable to monitor the company’s financial performance post-listing before making a long-term investment decision .

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Should You Subscribe?

Consider subscribing if:

• You’re looking for short-term listing gains
• You believe in the company’s long-term growth potential
• You’re comfortable with the associated risks

Consider waiting if:

• You’re risk-averse
• You’re concerned about the company’s declining margins and high debt levels

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Disclaimer: This article is for informational purposes only and does not constitute investment advice. Please consult a financial advisor before making investment decisions.

 Disclaimer

The information provided in this blog is intended solely for educational and informational purposes. It does not constitute financial advice, stock recommendations, or an offer to buy or sell any securities. Readers are advised to conduct their own research and consult with a qualified financial advisor before making any investment decisions. Please note that stock prices, financial data, and company information mentioned in this article are subject to change on trading days. For the most recent and accurate updates, kindly refer to the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) official websites. Incorporating images can effectively use internal links to enhance user engagement and navigation.

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