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Sona Machinery Ltd IPO : Review, Valuation, Opening Date & GMP

Sona Machinery Limited IPO - Complete Overview
Sona Machinery Limited IPO Overview
Company Financial
The Objective of the Issue
Peers of Sona Machinery Limited IPO
IPO's Strengths
IPO's Weaknesses
IPO GMP Today
Sona Machinery Limited IPO timetable (Tentative)
Sona Machinery Limited IPO Details
Sona Machinery Limited IPO Lot Details
Sona Machinery Limited IPO Reservation
Promoters and Management of Sona Machinery Limited
Sona Machinery Limited IPO Lead Managers
Dividend Policy
Conclusion

Sona Machinery Limited IPO - Complete Overview

Established in 2019, Sona Machinery Limited is a dynamic agro-processing equipment manufacturer, specializing in the production of machinery for processing rice, pulses, wheat, spices, Barnyard Millet, and more.

The diverse product portfolio of the company includes Grains Pre-Cleaner machines, Rotary Drum Cleaner, Vibro Classifiers, Stone Separator Machines, Paddy De-Husker, Husk Aspirator, Rice Thick/Thin Grader, Rice Whitener, Silky Polisher, Multi Grader, Length Grader, Belt Conveyer, Bucket Elevator, and more.

The company provide comprehensive services encompassing engineering, erection, supervision, and machine commissioning, offering end-to-end solutions for the milling section, including grain unloading and milling solutions up to pre-masher for ethanol distilleries, and paddy unloading to rice packaging for rice mill industries.

Located in Ghaziabad, Uttar Pradesh, the manufacturing unit spans approximately 52,205 sq. ft., with a dedicated warehouse for material and finished goods storage.

Sona Machinery Limited has also expanded its reach globally, exporting a portion of its products to countries such as Nigeria, Bangladesh, Kenya, and Nepal.

The company maintain the highest quality standards, evident in its ISO 9001:2015 certification for Quality Management Systems by Das System & Services Pvt Ltd.

In the financial year 2023, the total revenue amounted to 8,096.63.

Sona Machinery Limited IPO Overview

Sona Machinery Limited IPO date is slated to be open for subscription from March 5, 2024, to March 7, 2024. This NSE SME IPO follows a Book built Price Issue IPO.

Sona Machinery Limited IPO price is set in the range of Rs.136 to Rs.143 per share.

The total issue size of this IPO amounts to Rs.51.82 Cr. The company has reserved 35% for retail investors and 50% for institutional investors.

Company Financial

Compared to the previous fiscal year, Sona Machinery Limited has seen growth in total assets, net worth, and total revenue. The profit after tax has increased, while total borrowings have also risen.

(Amount in Lakhs)

Period	30 Nov 2023	31 Mar 2023	31 Mar 2022
Total Assets	4,211.30	2,858.19	1,516.58
Total Revenue	6,288.11	8,118.06	4,453.07
PAT	647.82	768.36	326.47
Net worth	1,780.16	1,132.34	363.98
Reserve & Surplus	770.16	1,122.34	353.98
Total Borrowings	112.94	252.60	236.61

Product-wise Revenue Breakup

(Amount in lakhs)

Product Name	Period ended Nov 30, 2023	FY 2022-23	FY 2021-22
Material Handling	1,876.44	2,925.08	1,391.78
Milling Machines	1,275.89	1,167.45	461.51
Cleaning Machine	1,192.96	1,615.99	1,026.96
Grading Machines	873.96	1,051.92	705.99
Aspiration Machine	395.35	461.47	206.35
Spares, Scrap and Others	312.41	408.09	325.69
Rice Blending	224.02	250.91	95.37
Accessories	59.28	206.79	220.52
Service & Installation	0.72	8.93	17.42
Sortex	64.25	-	-
Total	6,275.28	8,096.63	4,451.59

Geography-wise Revenue Breakup

(Amount in Lakhs)

Name of the State	Period ended Nov 30, 2023	FY 2022-23	FY 2021-22
Uttar Pradesh	1,949.31	1,801.01	1,055.55
Chhattisgarh	1,073.57	1,297.56	702.82
Bihar	724.96	508.05	236.59
Madhya Pradesh	627.39	978.69	316.50
Haryana	526.02	1,032.33	658.25
Telangana	411.64	748.47	303.70
Odisha	242.23	159.41	279.05
Punjab	198.99	36.90	3.30
Uttrakhand	136.86	401.04	68.81
Gujarat	79.17	4.94	113.18
Total	5,970.14	6,968.40	3,737.75

The Objective of the Issue

The company will utilize the net proceeds from the Issue for the following objectives:

1. Financing the Capital Expenditure needed to establish a new manufacturing unit in Ghaziabad.

2. Settling the outstanding balance of the Letter of Credit used by the company to procure machinery.

3. Addressing general corporate needs.

Peers of Sona Machinery Limited IPO

No companies listed in India operate in a business line similar to Sona Machinery, making it impossible to offer an industry comparison for the company.

IPO's Strengths

The company has a wide array of products that serve a varied clientele, meeting a wide range of needs and preferences.

Commitment to quality assurance ensures consistent standards across all products, guaranteeing standardized quality.

Revenue streams from various geographical locations provide a diversified income source, enhancing stability and resilience.

Led by an experienced Promoter and senior management team, supported by a sales force possessing industry knowledge.

IPO's Weaknesses

The company's operating history is relatively short.

A significant portion of the company's revenue is generated from specific geographic regions, leaving it vulnerable to adverse developments in those areas.

The agricultural sector's seasonal nature impacts the company's operations.

The company requires various approvals, licenses, registrations, and permits to conduct its business.

Legal proceedings involve the Company, Promoters, and Directors.

The company faces competition from both organized and unorganized market players.

Negative operating cash flows have been experienced by the company in the past.

Sona Food India Private Limited, a Promoter Group company, is currently in Dormant Status.

IPO GMP Today

The Latest GMP of Sona Machinery Limited IPO is Rs.80.

Sona Machinery Limited IPO timetable (Tentative)

Sona Machinery Limited IPO is scheduled from March 5 to March 7, 2024, with allotment on March 11, refund initiation on March 12, and listing on March 13, 2024.

Events	Date
IPO Opening Date	March 5, 2024
IPO Closing Date	March 7, 2024
IPO Allotment Date	March 11, 2024
Refund initiation	March 12, 2024
IPO Listing Date	March 13, 2024

Sona Machinery Limited IPO Details

Sona Machinery Limited IPO, with a face value of Rs.10 per share, opens on March 5 and closes on March 7, 2024, offering 3,624,000 shares at Rs.136 to Rs.143 per share, with a lot size of 1000 shares, aiming to raise Rs.51.82 Cr, and will be listed on NSE SME.

IPO Opening & Closing Date	March 5, 2024 to March 7, 2024
Face Value	Rs.10 per share
Issue Price	Rs.136 to Rs.143 per share
Lot Size	1000 Shares
Price of 1 lot	Rs.143,000
Issue Size	3,624,000 shares (aggregating up to Rs.51.82 Cr)
Fresh Issue	3,624,000 shares (aggregating up to Rs.51.82 Cr)
Listing at	NSE SME
Issue Type	Book Built Issue IPO
Registrar	Maashitla Securities Private Limited

Sona Machinery Limited IPO Lot Details

For Sona Machinery Limited IPO, the retail investor minimum and maximum lot investments are both 1 lot (1000 shares) at Rs.143,000 while for HNI investors, the minimum investment is 2 lots (2000 shares) at Rs.286,000.

Minimum Lot Investment (Retail)	1 lot
Maximum Lot Investment (Retail)	1 lot
Minimum Lot Investment (HNI)	2 lot

Sona Machinery Limited IPO Reservation

Institutional share Portion	50%
Non-institutional share Portion	15%
Retail share Portion	35%

Promoters and Management of Sona Machinery Limited

Vasu Naren

Shweta Baisla

Pre-issue Promoter shareholding	100.00%
Post-issue Promoter shareholding	73.59%

Sona Machinery Limited IPO Lead Managers

Hem Securities Limited

Dividend Policy

The company didn’t pay dividends in past financial years. The likelihood of future dividend payments hinges on several factors, including profits, past dividend patterns, capital requirements, legal constraints, and other important factors assessed by the Board.

Conclusion

Sona Machinery Limited presents a compelling investment prospect with its upcoming IPO launch. The company has consistently enhanced its financial performance over the years. With a diverse clientele and revenue streams, it offers a robust income base. However, potential investors are advised to thoroughly evaluate the IPO's advantages and disadvantages before bidding on this IPO.

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO.

You must consult your financial advisor before making any financial decisions.

To Apply for the IPO, Click Here.

To Read the Prospectus of the Company Click Here to Download the DRHP.

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Frequently Asked Questions

When is the Sona Machinery Limited IPO opening?

The IPO is scheduled to open for subscription on March 5, 2024.

What is the issue price of Sona Machinery Limited IPO?

The issue price for Sona Machinery Limited IPO is set in the range of ₹136 to ₹143 per share.

What is the total issue size of the IPO?

The total issue size of the IPO is Rs.51.82 Cr, with 35% reserved for retail investors.

What is the IPO closing date?

The IPO is set to close on March 7, 2024.

What are the plans for the proceeds from the IPO?

The IPO's net proceeds will be allocated towards Funding the Capital Expenditure requirements of the company towards setting up a new manufacturing unit at Ghaziabad, repayment of the outstanding amount of the Letter of Credit availed by the company for the purchase of machinery, and General Corporate Purpose.