{"id":733,"date":"2021-06-10T08:47:52","date_gmt":"2021-06-10T08:47:52","guid":{"rendered":"https:\/\/www.invest19.com\/blog\/?p=733"},"modified":"2021-06-10T09:45:17","modified_gmt":"2021-06-10T09:45:17","slug":"blackstone-backed-sona-comstar-will-hit-the-primary-market-on-june-14-should-you-subscribe","status":"publish","type":"post","link":"https:\/\/www.invest19.com\/blog\/blackstone-backed-sona-comstar-will-hit-the-primary-market-on-june-14-should-you-subscribe\/","title":{"rendered":"Blackstone backed Sona Comstar Will Hit The Primary Market On June 14. Should You Subscribe?"},"content":{"rendered":"<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-share-buttons\" ><\/div>\n<p>World\u2019s leading Private-Equity firm Blackstone seems aggressive in\nlisting its funded companies in India as the firm has decided to list its\nfunded auto ancillary Sona Comstar after selling its stake in Mindsace REIT.\nThe firm has lined up its housing finance lender \u2018Aadhar Housing Finance\u2019 which\nwill be listed soon. Listing of auto ancillary at time when the Indian\nbenchmark indices are scaling high signals that leading PE firm is looking to\nreap the benefits of healthy valuations.<\/p>\n\n\n\n<p>The issue size is a mix of fresh issue of Rs. 300 crores and offer for sale of Rs. 5,250 crore by Singapore VII Topco III Pte Ltd. According to Draft Red Herring Prospectus, the issue comprises of Rs. 300 crores to be raised from issuance of fresh equity will be utilized for repayment of company\u2019s debt amounting at Rs. 225 crores while the rest will be utilized general corporate purpose.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"counter-hierarchy counter-decimal ez-toc-grey\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list\"><li><a href=\"#Sona_Comstar_IPO_Details\" title=\"Sona Comstar IPO Details:\">Sona Comstar IPO Details:<\/a><\/li><li><a href=\"#About_the_Company\" title=\"About the\nCompany\">About the\nCompany<\/a><\/li><li><a href=\"#Industry_Growth_Drivers\" title=\"Industry Growth Drivers\">Industry Growth Drivers<\/a><\/li><li><a href=\"#Financials\" title=\"Financials\">Financials<\/a><\/li><li><a href=\"#Book_Runners\" title=\"Book Runners\">Book Runners<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Sona Comstar IPO Details:<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li>Issuer Company: Sona Comstar.<\/li><li>Industry: &nbsp;Auto Ancillary<\/li><li>IPO Size: 5,550 cr.<\/li><li>Price Band: 285-291<\/li><li>Issue Open Date: 14 June, 21<\/li><li>Issue Close Date: 16 June, 21<\/li><li>Minimum Lot Size: 51 shares<\/li><li>Employee Discount: 15 Rs. Per share<\/li><li>Face Value: 10 Rs. Per share<\/li><li>Retail Allocation: 10%<\/li><li>Listing Exchange: NSE, BSE<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About the\nCompany<\/strong><\/h2>\n\n\n\n<p>The journey of the company started in 1995 as Sona Okegawa Precision\nForgings, which was a 75:25 joint venture between the Sona Group and Mitsubishi\nMaterials and the pioneer of warm forged near net-shaped gears manufacturing\ntechnology. The Sona Group, after acquiring Thyssen Krupp\u2019s forging business\n(which acquired BLW, the inventor of warm forging) and 25% stake of Mitsubishi,\nrenamed the company to Sona BLW Precision Forgings, which became the largest\nmanufacturer of forged gears. In 2019, Sona BLW acquired Comstar Automotive, a\nleading designer and manufacturer of starting and charging systems for\nautomobiles, and created a new identity.<\/p>\n\n\n\n<p>The whole journey of the company is filled with expansion of their manufacturing plants acquisitions of associated companies to achieve economies of scale. The company has manufacturing plants in Chennai, Pune, Gurgaon and Chakan. Globally, the leading auto ancillary has manufacturing plants in USA, China and Mexico. The company supplies its products across the countries such as India, US, Europe, and China. <\/p>\n\n\n\n<p> Must Read: <a href=\"https:\/\/www.invest19.com\/blog\/shyam-metalics-will-hit-the-primary-market-on-june-14-should-you-subscribe\/\">Shyam Metalics Will Hit The Primary Market On June 14. Should You Subscribe?<\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Industry Growth Drivers<\/strong><\/h2>\n\n\n\n<p>Despite the resurgence in Covid-19 cases, global economy is seeing\ngradual signs of recovery in automobile industry. The rising income of the\nIndian population and shift to comfort comes first psychology will keep the\ndemand of auto industry intact. The introduction of PLI (Production Linked\nIncentive) scheme which accounts for Rs. 751 billion in automobile &amp; auto\ncomponents and Advanced Chemistry Cell (ACC) battery is expected to push the\nexpansion plans and achieve economies of scale in the industry. Rising\ninfrastructure spending from government, increasing trend in CAGR of passenger\nvehicles, electric vehicle and commercials alongwith manufacturing incentives\nfrom administration is expected keep the rising trend in automobile industry.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Financials<\/strong><\/h2>\n\n\n\n<p>On the financial front, the company had reported an inconsistency in\nthe growth prospects of revenues. The balance sheet of the firm reports\nnon-current financial borrowing around 230 crores, which is expected to pay off\npost listing. The company has managed to pass on the increased prices of steel in\ndriveline segment and copper prices in motor segment while rise in prices of\nsteel and aluminum in similar segment are absorbed. EBITDA margins of the company\nstands at 28% much higher than its listed peers. Return of Equity stands at\n35%. The company has extended its operations to Battery Electric Vehicle (BEV)\nsegment for which continuous R&amp;D is conducting by the company. Considering\nthe upper price band and FY20 EPS, the company is demanding a P\/E multiple of\n75.6x, lower than the Industry P\/E of 140. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Book Runners<\/strong><\/h2>\n\n\n\n<p>Kotak Mahindra Capital Company, Credit Suisse Securities, JP Morgan India, JM Financial, and Nomura Financial Advisory and Securities are the book running lead managers to the issue.<\/p>\n\n\n\n<p> <\/p>\n<div class='epvc-post-count'><span class='epvc-eye'><\/span>  <span class=\"epvc-count\"> 2,886<\/span><\/div><div class=\"pld-like-dislike-wrap pld-template-1\">\n    <div class=\"pld-like-wrap  pld-common-wrap\">\n    <a href=\"javascript:void(0);\" class=\"pld-like-trigger pld-like-dislike-trigger \" title=\"\" data-post-id=\"733\" data-trigger-type=\"like\" data-restriction=\"ip\" data-ip-check=\"0\" data-user-check=\"1\">\n                        <i class=\"fas fa-thumbs-up\"><\/i>\n                    <\/a>\n    <span class=\"pld-like-count-wrap pld-count-wrap\">7    <\/span>\n<\/div><\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>World\u2019s leading Private-Equity firm Blackstone seems aggressive in listing its funded companies in India as the firm has decided to list its funded auto ancillary [&hellip;] <span class=\"read-more-link\"><a class=\"read-more\" href=\"https:\/\/www.invest19.com\/blog\/blackstone-backed-sona-comstar-will-hit-the-primary-market-on-june-14-should-you-subscribe\/\">Read More<\/a><\/span><\/p>\n","protected":false},"author":1,"featured_media":734,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[70,2,7],"tags":[],"class_list":["post-733","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ipo","category-stock-market","category-investment"],"_links":{"self":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/733","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/comments?post=733"}],"version-history":[{"count":3,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/733\/revisions"}],"predecessor-version":[{"id":740,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/733\/revisions\/740"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media\/734"}],"wp:attachment":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media?parent=733"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/categories?post=733"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/tags?post=733"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}