India's premier auto ancillary company, ASK Automotive, is poised to launch its Initial Public Offering (IPO) on November 7, with the public subscription ending on November 9. The anchor book opens a day earlier on November 6, as revealed by the Red Herring Prospectus (RHP) disclosed earlier this week.
The IPO comprises an offer-for-sale of approximately 295 million equity shares by the company's promoters, Kuldip Singh Rathee and Vijay Rathee. Notably, all proceeds from this sale will go directly to the promoters as there is no fresh issue component included in this IPO.
ASK Automotive, based in Gurugram, is a dominant player in the brake-shoe and advanced braking systems market for two-wheelers. Holding a substantial 50% market share in fiscal year 2023, the company also offers aluminum light-weighting precision solutions and SCC products to diverse vehicles.
With an extensive network of 15 manufacturing facilities across India, ASK has established partnerships with leading two-wheeler manufacturers including Hero MotoCorp, Honda (NYSE:HMC) Motorcycle and Scooter India, Bajaj Auto, India Yamaha Motor, TVS Motor, and Suzuki Motorcycle India.
In the fiscal year ending March 2023, ASK reported a net profit of ₹122.9 crore ($16.5 million) and revenue of ₹2,555.17 crore ($343 million). For the first quarter of FY24 ending June, the company posted a net profit of ₹34.83 crore ($4.7 million).
The allotment of IPO shares is scheduled to be finalized by November 15 and credited to investors' demat accounts by November 17. ASK plans to debut on both the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on November 20 under the management of JM Financial, Axis Capital (NYSE:AXS), ICICI Securities, and IIFL Securities.
This IPO comes on the heels of the Securities and Exchange Board of India (SEBI) approval in October and is the third public issue opening in November following ESAF Small Finance Bank and Protean eGov Technologies. Given ASK Automotive's robust growth and profitability, a high investor reception is anticipated.
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