Indo Farm Equipment Limited IPO

About Indo Farm Equipment Limited

Established in 1994, Indo Farm Equipment Limited boasts a rich history spanning over two decades as a fully integrated manufacturer of top-tier Tractors, Pick & Carry Cranes, and an array of farm equipment, including Harvester Combines and Rotavators, along with their associated spare parts and components.

The company's product line extends to global markets, with a sales distribution of 90% within the domestic market and 10% in exports over the last three fiscal years. The company's manufacturing facilities, accredited with ISO 9001:2015 certification, sprawl across 1,27,840 square metres of industrial land situated in Baddi, Himachal Pradesh. This extensive setup encompasses a dedicated foundry unit, machine shop, fabrication and assembly units for Tractors, Pick & Carry Cranes, and other equipment.

Indo Farm Equipment Limited's manufacturing infrastructure is fully equipped with induction furnaces, pneumatic molding machines, automatic molding lines, a sand plant, a comprehensive Metallurgy and Sand Testing Laboratory, Machining Center, Gear Shop, Press Shop, Fabrication Shop, Paint Shop, Assembly unit, Quality Room, and Utility room.

In 2006, an in-house captive foundry was established, and in 2007, Pick & Carry Cranes were introduced to the company's portfolio, establishing the organisation as a pioneering entity in this sector. In 2017, an in-house Non-Banking Financial Company (NBFC) was launched to provide retail financing for the tractor line.

The products are marketed and distributed through a network of more than 140 dealers across various states, including Punjab, Haryana, Uttar Pradesh, Maharashtra, Gujarat, and Rajasthan. Over the years, a comprehensive integrated ecosystem has been developed to ensure the provision of high-quality products and financial support to customers.

The India Agricultural Machinery Market is poised for substantial growth. It is projected to increase from USD 15.42 billion in 2023 to USD 23.18 billion by 2028, exhibiting a robust CAGR of 8.50% over the forecast period of 2023-2028. This remarkable progress in the farm agri equipment market in India can be attributed to factors such as government incentives, an upward trajectory in rural income levels, and readily available credit facilities.

As of August 31, 2023, the company's production facilities possess the capability to produce 12,000 tractors per annum and 720 pick and carry cranes per annum. The current manufacturing portfolio includes tractors with power outputs ranging from 16 HP to 110 HP and pick-and-carry cranes with lifting capacities ranging from 9 tons to 30 tons. The company has proposed expanded capacity in the objectives of the IPO.

Indo Farm Equipment Limited IPO Details

Indo Farm Equipment Limited IPO Date

The exact dates are yet to be announced.

Indo Farm Equipment Limited IPO Price Band

The exact price range is yet to be announced.

Indo Farm Equipment Limited IPO Lot Size

The exact lot size is yet to be announced.

Indo Farm Equipment Limited IPO Lot Size

The company plans to allocate the net proceeds from the issuance to the following purposes:

1. Expansion of Manufacturing Capacity: The company plans to establish a dedicated Pick and Carry Crane production line on a nearby land parcel, increasing our annual crane production capacity by 3,600 units. The estimated cost for this expansion is ₹706.15 million, to be financed entirely from the Net Proceeds of the Offer.
2. Repayments on Borrowings:
As of March 31, 2023, the company's standalone outstanding borrowings were ₹1,704.86 million. Approximately ₹600.00 million from the Net Proceeds will be allocated to repay or pre-pay specific borrowings.
3. Further Investment in NBFC Subsidiary (Barota Finance Ltd.): As of March 31, 2023, the company had a total loan book of Rs. 1,500.51 million in Vehicle Finance, serving over 5,900 active customers. To support future growth in the NBFC business, the company intends to invest ₹450.00 million in its subsidiary, BFL, using net proceeds, either in the form of debt or equity.
4. General Corporate Purpose: Indo Farm Equipment Limited plans to utilise the remaining Net Proceeds for general corporate purposes. This includes strategic initiatives, debt reduction, facility enhancements, brand promotion, and any other Board-approved needs.