Belrise Industries IPO Opens for Subscription: Here’s What Investors Should Know

Does this globally present automotive manufacturer, backed by strong ties with renowned OEMs like Bajaj Auto, Honda Motorcycle & Scooter India, Hero MotoCorp, Jaguar Land Rover, and Eicher Motors, merit a place in your investment portfolio?

About the Issue:  

Belrise Industries Ltd is preparing to launch its Initial Public Offering (IPO) for equity shares. See the issue details below.

Objects of the Issue  

Since the offer is exclusively a fresh issue, it is noteworthy that the company will use the proceeds for its growth and expansion plans, rather than the funds flowing to promoters.

The company plans to allocate the net proceeds raised from the fresh issue for the following purposes:

1. Repayment/pre-payment, in full or in part, of certain outstanding borrowings availed by the company

2. General corporate purposes

Promoter holding 

Shrikant Shankar Badve, Supriya Shrikant Badve and Sumedh Shrikant Badve are the promoters of the company. The promoters and promoter group currently hold a pre-issue shareholding stake of 99.81 per cent in the company.

Company profile  

The company is a leading automotive component manufacturer, offering a comprehensive portfolio of safety-critical systems and advanced engineering solutions for two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, and agricultural vehicles. Its product lineup includes metal chassis systems, polymer components, suspension systems, body-in-white parts, and exhaust systems, among others.

Notably, its products are largely powertrain-agnostic, enabling it to serve both electric and internal combustion engine vehicles. This positions the company well to capitalize on the growing shift towards electric mobility.

Specializing in precision sheet metal pressing and fabrication—essential for assembling vehicle substructures—the company holds a strong market position, ranking among the top three players in India's two-wheeler metal components segment, with a 24 per cent revenue-based market share as of March 31, 2024.

As of December 31, 2024, the company had built a diversified customer base comprising 29 OEMs, including longstanding partnerships with major domestic and international manufacturers such as Bajaj Auto, Honda Motorcycle & Scooter India, Hero MotoCorp, Jaguar Land Rover, and Eicher Motors.

Its operations span both domestic and global markets, with an international presence in Austria, Slovakia, the United Kingdom, Japan, and Thailand.

By March 31, 2025, the company operated 17 manufacturing facilities across nine Indian states, strategically expanding its capabilities through both backward and forward integration. A notable milestone was the acquisition of H-One India Private Limited, formerly a subsidiary of Japan-based H-One Company Limited, completed in March 2025.

Financials 

The company has consistently demonstrated notable growth in revenue over the past few years. Between FY22 and FY24, it achieved a Compound Annual Growth Rate (CAGR) of 18 per cent in revenue.

However, the company witnessed some inconsistency in its bottom line, with FY24 profit remaining flat. This was primarily impacted by changes in inventory levels of finished goods and elevated finance costs.

The company currently has total borrowings of Rs 2,600 crore, of which Rs 1,600 crore will be repaid using the net proceeds from the fresh issue. This substantial debt reduction is expected to ease the interest burden significantly, resulting in savings of over Rs 100 crore in interest costs and supporting an improvement in the bottom line going forward.

If the current momentum sustains, the annualized 9MFY25 performance indicates considerable growth in both revenue and net profit over FY24 levels.

For FY24, the company delivered notable financial performance, recording a return on equity (RoE) of 14 per cent and a return on capital employed (RoCE) of 17 per cent.

Valuation & Returns 

*RoE: Based on FY24 data

The issue is priced with a P/BV ratio of 2.26 times, calculated using its Net Asset Value (NAV) of Rs 39.75 as of December 31, 2024. At the upper price cap, it is priced at a P/BV ratio of around 1.69 times, considering its post-IPO NAV.

Considering the company's annualized FY25 earnings and fully diluted equity capital, the price-to-earnings (P/E) ratio is calculated at around 18x.

Considering both valuations and returns, the company's issue stands out as one of the most attractively priced among its listed peers and the industry average, while also offering promising returns.

Outlook

The automotive components industry is poised for substantial growth in the future, driven by several key factors including rising vehicle production, technological advancements, shift towards EV, supportive government policies and PLI Schemes.

Considering the optimistic industry outlook, the company is well-positioned for strong growth, backed by its sound financial performance, significant market share, diversified product portfolio, and long-standing relationships with leading OEMs.

Hence, we recommend subscribing to this issue with a long-term investment perspective.