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Issue opens on December 14

IPO ROUTE: Dr D.K. Jain (right), Chairman & Director, Lumax Auto Technologies, and Mr Anmol Jain, Director, at a press conference to announce the company's IPO in Mumbai on Tuesday. - Shashi Ashiwal

Mumbai , Nov. 28

Auto component manufacturer Lumax Auto Technologies Ltd is coming out with a public issue of 30,12,000 equity shares of Rs 10 each at a premium of Rs 65 per share, to raise Rs 22.59 crore.

The proceeds of the issue will fund capacity expansion and modernisation of existing facilities.

The issue, which opens on December 14 and closes on December 21, will constitute 25.90 per cent of the fully diluted post issue paid-up capital of the company. About 50 per cent of the issue has been allocated to retail investors.

Lumax Auto manufactures sheet metal products and lighting systems components for two- and three-wheeler industries. The company's main customers are Bajaj Auto Ltd and Maharashtra Scooters Ltd.

"Auto industry is growing at a good pace in the country but companies' margins are under pressure. Only growth in volumes will help companies to move up the profit charts. This is opportunity for OEMs (original equipment manufacturers) and auto component manufacturers. The sector, currently having a turnover of $10 billion, is expected to touch $ 40 billion by 2014," said Mr D.K. Jain, Chairman, Lumax Auto.

The issue monies will be invested in Lumax DK Auto Industries Ltd, a wholly owned subsidiary of the company. Lumax DK will set up an automotive lighting unit at Pant Nagar, Uttaranchal, a levelling motor unit at Manesar, Haryana, and also expand the Manesar unit.

Part of the proceeds will be used to set up a chassis assembly unit at Bhosari in Pune and expand existing units at Chakan, near Pune and Waluj, near Aurangabad. The development centre at Chinchwad, near Pune, will also be modernised.

"Technical and financial collaboration with Stanley Electric, Japan, strategic plant locations and sustained growth are our strengths. The company has been logging a growth rate of 30 per cent over the past few years. Capital expansion will help the company to hold its leadership position," said Mr Anmol Jain, Director, Lumax Auto.

Centrum Capital Ltd and SB&T Finance Pvt Ltd are the book running lead managers to the issue.

More Stories on : Public Offer | Automobile Components

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