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Sona Comstar receives approval from SEBI to launch Rs 6,000 crores IPO

News24

LAST UPDATED: May 12, 2021, 3:47 p.m.

New Delhi (Anish Yande): Sona BLW Precision Forgings has received approval from market regulator Securities and Exchange Board of India for its initial public offering. The Blackstone-backed company would be aiming to raise Rs 6,000 crores through its initial public offering.

Sona BLW Precision Forgings to raise Rs 6,000 crores through IPO:

The public offer of Sona BLW Precision Forgings consists of a fresh issue of Rs 300 crore. The issue would constitute of an offer for sale of Rs 5,700 crore. Promoter of the company, Singapore VII Topco III Pte Ltd, which is an affiliate of the Blackstone Group Inc would be selling its stake in the auto component maker.

Blackstone Group holds a stake of 66.28% in Sona BLW Precision Forgings that would be reduced following the IPO. 

In the initial public offering, 75% of the issue is reserved for Qualified Institutional Buyers. Sona Comstar has kept 15% of the issue reserved for non-institutional investors and the rest of the issue, that is 10%, would be kept aside for retail investors.

Details of Sona Comstar IPO:

The company would be using the proceeds from the fresh issue for repayment or pre-payment of borrowings. Credit Suisse Securities, JP Morgan India, Nomura Financial Advisory and Securities, Kotak Mahindra Capital Company, and JM Financial are the book running lead managers to the issue. 

Profits of Sona Comstar grew from Rs 77.57 crore in FY 2018 to Rs 360 crore in the financial year 2020. In the nine months ended December 2020, the net profits of the company were at Rs 155 crore. 

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Sona BLW Precision Forgings manufactures and supplies automotive systems and components such as BSG systems, EV traction motors, differential assemblies, conventional and micro-hybrid starter motors. The firm supplies automotive systems to markets in Europe, India, the US, and China.

The clients of the auto component maker include Maruti Suzuki, CNH, Daimler, Escorts, Jaguar Land Rover, Jaguar Land Rover, Mahindra and Mahindra, Mahindra Electric, Renault Nissan, Volvo, and Ashok Leyland.

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