Italy's Carraro Group-owned Carraro India plans Rs 1,812 crore IPO, files draft papers with SEBI

Carraro India IPO

Carraro India, which manufactures axles and transmission systems for agricultural tractors and construction vehicles, plans to raise Rs 1,811.65 crore via initial public offering. It has filed preliminary papers with the capital markets regulator SEBI on August 23.

On June 24, Moneycontrol was the first to report that Carraro Group had picked i-bankers and initiated work on an India IPO.

The public issue comprises solely an offer-for-sale of Rs 1,811.65 crore by promoter Carraro International S E (a holding company for investment purposes), a part of the Carraro S.p.A. Hence, the entire issue proceeds will go the selling shareholder, and the company will not receive any funds from the IPO.

Italy-based promoter Carraro S.p.A., is the parent company of the Carraro Group which manufactures transmission systems (axles, transmissions and drives) for agricultural and construction equipment for off-highway vehicles.

Established in 1997, Carraro India that competes with listed peers like Escorts Kubota, Schaeffler India, Sona BLW Precision Forgings, Ramakrishna Forgings, Happy Forgings, and Action Construction Equipment, manufactures backhoe loaders, soil compactors, cranes, self-loading concrete mixers and small motor graders for agricultural tractors and construction vehicles. It also supplies gears, shafts and ring gears for industrial and automotive vehicles.

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The company, which operates two manufacturing plants in Pune and supplied products to 38 manufacturers in India in FY24, generated 64.82 percent of revenues from domestic sales in the last financial year.

Profit for the fiscal year 2024 at Rs 60.6 crore grew by 29.4 percent over Rs 47 crore recorded in the previous year despite tepid growth in topline, backed by strong operating performance.

Carraro recorded revenue at Rs 1,770.5 crore for the year ended March 2024, growing 4.4 percent over the previous fiscal. EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 27.2 percent on-year to Rs 128.2 crore with margin expanding by 130 bps to 7.2 percent in FY24.

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Axis Capital, BNP Paribas, and Nuvama Wealth Management are acting as the merchant bankers to the issue.