Notable anchor investors include: Bank of Australia Securities Europe SA, NAV Capital VCC, Chhatisgarh Investments, among others.
The IPO includes a fresh issue of shares worth Rs 200 crore and an offer for sale of shares worth Rs 30 crore. Under the offer for sale, promoters Kalamparambil Varkey Tolin and Jerin Tolin will sell shares worth Rs 15 crore each.
Tolins Tyres IPO price range
He price band The IPO price has been fixed at Rs 215-226 per share and investors can bid for 66 shares in one lot.
Tolins GMP Tires
Before the issue opening, the GMP of Tolins Tyres was around Rs 29-30, suggesting a 13% premium over the issue price.
Tolins Tire Review
Analysts advised investors to subscribe to the issue due to reasonable valuations and growth opportunities in the agriculture and electric vehicle segments.
At the upper price band, Tolin Tyres is valued at a P/E of 34.8x based on FY24 EPS, suggesting a fair valuation in line with its peers.
“As a leading tyre retreading company, Tolin also manufactures tyres and plans to expand into the radial tyre market and aerospace and defence sectors. We assign a subscribe rating to the issue as valuations appear fair,” Indsec Securities said.
“Investors seeking long-term exposure to the tyre industry may consider applying for the Tolins Tyres IPO, recognising the potential challenges posed by the competitive landscape and the timing of the IPO,” Swastika Investmart said.
Other details
Of the Rs 200 crore raised through the IPO, Rs 75 crore will be used to raise long-term working capital requirements and Rs 62 crore for repayment of initial investment. In addition, around Rs 24 crore will be used to invest in the company’s subsidiary, Tolin Rubbers, to repay its debt and meet its working capital requirements.
Tolins Tyres is active in both sectors: manufacturing of new tyres and tread rubber. It is mainly engaged in the manufacturing of bias tyres for vehicles (including light commercial vehicles, agricultural vehicles and two and three wheelers) and pre-cured tread rubber.
The company also manufactures auxiliary products such as adhesive rubber, vulcanizing solution, protectors and inner tubes for tires.
Tolins Tyres’ competitive strengths lie in its operational efficiency, ensuring on-time deliveries, strict quality control and product innovations.
The company has achieved robust growth in revenue, EBITDA and PAT at a CAGR of 42%, 176% and 542% between FY22 and FY24, driven by capacity expansion and vertical integration.
Its operating revenue in FY24 stood at Rs 227 crore and profit at Rs 26 crore. In FY24, the company generated revenue of Rs 51 crore from new tyre sales, which accounted for 24% of total sales. Meanwhile, tread revenue accounted for the remaining 76% of total sales.
Saffron Capital Advisor is acting as sole lead book-runner, while Cameo Corporate Services is the registrar.
(Disclaimer:The recommendations, suggestions, views and opinions of the experts are their own and do not represent the views of the Economic Times)
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