Indian opto-semiconductor chips manufacturer, Polymatech Electronics, has submitted an application for a ₹750 crore initial public offering (IPO) to the Securities and Exchange Board of India (SEBI) on Thursday. A significant portion of the funds raised, amounting to ₹566 crore, is earmarked for the acquisition of new machinery at their Oragadam production facility.
According to InvestingPro, Polymatech Electronics has been yielding high returns on invested capital and has more cash than debt on its balance sheet, which aligns with the company's decision to invest in new machinery at their facility. This strategic move comes after Polymatech reported a substantial increase in its financial performance, with revenue reaching ₹649 crore in the fiscal year 2023. The company also reported a profit-after-tax of ₹168 crore for the same period.
Polymatech Electronics is steered by key promoters and major shareholders Eswara Rao Nandam and Uma Nandam. The decision to upgrade machinery at their Oragadam facility indicates a focus on expanding production capabilities, possibly in response to the company's recent financial success.
For those interested in investing, it's worth noting that Polymatech Electronics is a prominent player in the Electrical Equipment industry, as pointed out by InvestingPro. The company's stockholders receive high returns on book equity, and it's been trading at a high earnings multiple. This, coupled with the fact that the company has been profitable over the last twelve months, makes it an attractive investment option.
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