Gajra Differential Gears files IPO papers with SEBI

Differential gears manufacturer Gajra Differential Gears proposes to tap capital market for funding the expansion. It has filed draft red herring prospectus with the SEBI for a public issue of 60 lakh equity shares of face value of Rs 10 each.

The issue would constitute 46.17% of the fully diluted post issue paid up capital of company.

Company is engaged in the business of manufacturing of differential/ axle gears for cars, trucks, tractors, jeeps, MCVs and LCVs. Its products are catering to replacement, Original Equipment Manufacturer (OEM) as well as export segment.

Gajra Differential Gears intends to use issue proceeds for expansion-cum-modernisation of existing manufacturing facility at Lohar Pipliya, Dewas, Madhya Pradesh; enhancement of infrastructure facilities at the existing plant located at Lohar Pipliya, Dewas, Madhya Pradesh; long term working capital requirement; and pre-payment and/or re-payment of term loans. Requirement of funds estimated at Rs 28.34 crore by the company for the above objects.

For the period of six months ended on September 30, 2010, it reported net profit of Rs 67.12 lakh and net sales of Rs 14 crore.