MTAR Technologies IPO Details and Review

Dates, Price band, Lot size, Risks, Review and broker recommendations etc.
MTAR Technologies IPO

MTAR Technologies IPO: Key Details

  • Grey Market Premium (GMP) today: ₹400 – ₹415
  • Raised 179 Cr via anchor investor sale @ ₹575 per share

Note: We neither trade nor encourage our readers to trade in the Grey Market. We share the GMP information for educational purposes only, so that, you can make an informed decision.

Company Information

MTAR Technologies, incorporated in 1999, is a leading precision engineering solutions company engaged in the manufacture of mission-critical precision components to serve projects of high national importance, through precision machining, assembly, testing, quality control, and specialized fabrication competencies, some of which have been indigenously developed and manufactured.

It primarily serves customers in the clean energy, nuclear and space and defence, sectors. Since inception, we have strived to grow continually, contributing to the Indian civilian nuclear power programme, Indian space programme, Indian defence and aerospace sector, as well as to the global clean energy sector and the global defence and aerospace sector.

MTAR’s aggregate Order Book as of December 31, 2020, was ₹ 336.19 crore, comprising Order Book in the clean energy sector, the nuclear sector and the space and defence
sectors of ₹ 80.19 crore, ₹ 93.19 crore and ₹ 1,60.61 crore, respectively.

Competitive Strengths

  • Precision engineering expertise with complex product manufacturing capability
  • Wide product portfolio leading to long-standing relationships with its customers
  • Modern technology at its state-of-the-art manufacturing facilities
  • Strong and diversified supplier base for sourcing of raw materials
  • Track record of growth in financial performance
  • Experienced and qualified management team

Company Strategy

  • Continue to strengthen the existing product portfolio and diversify into products with attractive growth and profitability prospects
  • Capitalize on the upward trend of the nuclear sector in India, increasing indigenization and policy initiatives in the defence sector, and commercialization of the Indian space sector
  • Focus on deepening and strengthening relationships with existing customers as well as catering to new customers
  • Expand international presence including through an increase in export
  • Grow the manufacturing capacity and increase market share through organic and inorganic routes
  • Continue to strive for operational efficiencies, supply chain rationalisation and effective planning

Proceeds from Fresh Issue of MTAR Technologies IPO will be used to:

  • Repayment/prepayment in full or in part, of borrowings availed by the company
  • Fund working capital requirements
  • Fund expenditures towards general corporate purposes.

MTAR will not receive any proceeds from the Offer for Sale. The Selling Shareholders will be entitled to their respective portion of the proceeds of the Offer for Sale, net of their respective portion of the Offer related expenses.

MTAR Technologies IPO: Financials

201820192020 Mar2020 Dec
Revenue from Ops159. 60 Cr183.67 Cr213.77 Cr177.27 Cr
Profit before Tax17.15 Cr41.55 Cr45.53 Cr39.60 Cr
Profit after Tax5.42 Cr39.12 Cr31.32 Cr28.07 Cr
EPS (Basic)1.9213.8911.1110.49

The restated profit for the period/year has grown at a CAGR of 140.31%, from ₹ 5.42 crore in fiscal 2018 to ₹ 31.32 crores in fiscal 2020. In the fiscal ended 2020, and in the nine months ended December 31, 2020, the company reported an EBITDA of ₹62.33 crore and ₹53.75 crore, respectively.

As of March 2020EPSP/E (Floor)P/E (Cap)
Based on basic EPS11.1151.6751.76

MTAR Technologies IPO: Comparison with industry peers

As per the RHP, none of the listed companies in India is engaged in a portfolio of business similar to MTAR technologies.

MTAR Technologies IPO Dashboard

Issue Details

TypeValue
Issue Size₹596.41 Cr
Fresh Issue₹123.52 Cr
Offer for Sale₹472.90 Cr
Face Value₹10/- per Equity Share
IPO Price₹574 – ₹575
Lot Size26 shares
LotsMin 1 – Max 13

Key Dates

Date TypeDate
Bid Open03/03/2021
Bid Close05/03/2021
Allotment Finalization10/03/2021
Initiation of Refunds12/03/2021
Credit of Shares15/03/2021
Listing Date16/03/2021

Lot Size and Price

LotsSharesAmount
126₹14,950
13328₹1,94,350

Promoter Holding

HoldingPercentage
Pre-Issue62.24%
Post-Issue50.25%
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MTAR Technologies IPO: Investor Quota and Shares Offered

Investor TypeQuotaShares on Offer
QIB50%20,74,484* shares
NII15%15,55,863 shares
RII (Retail)35%36,30,347 shares
Total100%72,60,694 shares
*Shares left for bidding after anchor investor sale of ₹179 crore

MTAR Technologies IPO: Risks

  • The company depends on Bloom Energy Inc. (“Bloom Energy”) and a limited number of other customers for a significant portion of its revenue.
  • The company depends significantly on orders from the NPCIL, ISRO and DRDO.
  • MTAR primarily rely on purchase orders to govern the volume and other terms of the sales of products. They do not have long-term supply agreements with their customers.
  • The company is subject to strict quality standards. Any failure to comply with such quality standards may lead to the cancellation of existing and future orders which may adversely affect the business
  • The number of orders we have received in the past and the current Order Book may not be indicative of the future growth rate or the number of orders we will receive in the future.

For complete internal and external risk factors, you can refer the RHP of the company.

MTAR Technologies IPO: Registrar and Lead Managers

Registrar of the Issue

KFintech (Formerly Karvy)
Selenium Building, Financial District, Nanakramguda, Serilingampally,
Rangareddi, Telangana India – 500 032.

Phone:040-67162222
Email: [email protected]

Lead Managers of the Issue

IIFL Securities Limited
JM Financial Limited


Phone
: 91 22 4646 4600 / 91 22 6630 3030
Email: : [email protected] /
[email protected]

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