Highlights
| Issue Size –: 23,88,88,888 shares | Issue Open/Close – 21 May / 23 May, 2025 |
| Price Band (Rs.) 85 – 90 | Issue Size (Rs.) – 21,500 mn |
| Face Value (Rs) 5 | Lot Size (shares) 166 |
Belrise Industries Limited (BIL) incorporated in 2008, is an automotive component manufacturing company offering a diverse range of safety critical systems and other engineering solutions for two-wheelers (2W), three-wheelers (3W), four-wheelers (4W), commercial vehicles (CV) and agri-vehicles.
Their product portfolio includes metal chassis systems, polymer components, suspension systems, body-in-white components and exhaust systems, among others. BIL products are largely agnostic to vehicle powertrain types, reflecting their ability in catering to both electric vehicles and internal combustion engine vehicles, thus positioning them favourably to adapt to the growing electric vehicle market.
They specialize in precision sheet metal pressing and fabrication and they are one of the top three companies with a market share of 24 pct in the overall two-wheeler metal components segment in FY24.
They market their product both domestically and internationally, with operations extending to several key global markets including Austria, Slovakia, the United Kingdom, Japan and Thailand. Since the commencement of their operations, they have cultivated long standing relationships with customers like Bajaj Auto Limited, Honda Motorcycle & Scooter India Private Limited, Hero MotoCorp Limited, Jaguar Land Rover Limited and Royal Enfield Motors Limited, among others.
Out of the total proceeds of Rs. 21,500 mn, Rs. 16,181 mn would utilise for repayment of certain borrowing availed by the company which comprises of 55.71 pct of BIL’s total borrowings as of FY25. BIL believe that such repayment will help them reduce a portion of outstanding indebtedness and debt servicing costs, assist them in maintaining a favourable debt to equity ratio and enable utilisation of their internal accruals for further investment in business growth and expansion. Remaining ~Rs. 5,319 mn would utilise for general corporate purpose.
Key Highlights
- The global 2W metal components market was valued at Rs. 1,453.85 bn in 2023, and is expected to be valued at Rs. 1,767.28 bn in 2029, registering a growth CAGR of 3.29 pct between 2024 and 2029. Further, the 2W metal products market size is projected to grow at a 11- 13 pct CAGR over the next 5 years through FY30.
- BIL engage in a collaborative business model, strategically establishing their manufacturing facilities close to the locations of customers. This proximity allows them to also work closely with customers to design, engineer and manufacture products. They have established 15 manufacturing facilities across eight states with capacity of 60,000 tonnes of steel and expanded their manufacturing capabilities through both backward and forward integration.
- For many years, the company has deployed over 700 robots for metal fabrication and developed semi-automated lines for complex sub-systems such as seating and steering columns.
- They plan to explore inorganic growth opportunities through mergers and acquisitions in Europe and North America, in order to increase reach across export markets. Also, they plan to expand distribution network to over 150 points across India within the next 2 years.
- BIL key growth strategies include (i) To increase content per vehicle through new, high value and complex products and more integrated systems (ii) Expand portfolio of electric vehicle and renewable energy products (iii) Build a portfolio of proprietary products, in-house and through collaborations (iv) Diversify 2W, 4W and CV customer base (v) Grow aftermarket presence and exports through organic and inorganic initiatives.
- The company’s sales have grown by 76.76 pct CAGR over FY22-24 where EBITDA and profit grown 10.86 pct and 8.97 pct CAGR over same period. In FY24 the company reported sales of Rs. 74,842 mn, rose 13.69 pct YoY. EBITDA grew 4.53 pct YoY while margins shrank 110 bps to 12.54 pct. However, profit fell to Rs. 3109 mn. As of 9MFY25 company registered sales/EBITDA /profit of Rs. 60,134 mn/Rs. 7,670 mn/ Rs. 2,455 mn.
Key Risk
- Due to rising EV adaptation, BIL’s sales from ICE vehicle may face downward pressure Currently sales to ICE vehicle forms 21 pct of sales.
- Their business is subject to seasonality, which may contribute to fluctuations in their results of operations and financial condition.
- Certain of BIL promoters and group companies are involved in ventures which are engaged in the same line of activity or business as that of BIL.
Financial Performance
| Particulars | FY22 | FY23 | FY24 | 9MFY24 | 9MFY25 |
| Sales (in Rs. mn) | 53,969 | 65,825 | 74,842 | 59,579 | 60,134 |
| EBITDA (in Rs. mn) | 7,635 | 8,977 | 9,384 | 7,600 | 7,670 |
| EBITDA Margin (%) | 14.15% | 13.64% | 12.54% | 12.76% | 12.76% |
| Profit (in Rs. mn) | 2,618 | 3,137 | 3,109 | 2,975 | 2,455 |
| Profit Margin (%) | 4.85% | 4.77% | 4.15% | 4.99% | 4.08% |
| RoCE (%) | 12.86% | 14.04% | 14.83% | 12.66% | 11.03% |
| RoE(%) | 16.44% | 16.60% | 14.18% | 13.61% | 9.97% |
| No. of manufacturing units | 15 | 15 | 15 | 15 | 15 |
Peer Comparison based on FY24 Financials
| Particulars | BIL | BFL | Uno Minda | MSWIL | JBM Auto Ltd. | Endurance Tech | Minda Corp |
| Sales (in Rs. mn) | 74,842 | 1,56,821 | 1,39,104 | 83,214 | 47,232 | 1,00,520 | 46,511 |
| EBITDA (in Rs. mn) | 9,384 | 26,043 | 16,106 | 10,132 | 5,898 | 13,332 | 5,153 |
| EBITDA Margin (%) | 12.54% | 16.61% | 11.58% | 12.18% | 12.49% | 13.26% | 11.08% |
| PAT (in Rs. mn) | 3,109 | 9,102 | 9,247 | 6,383 | 1,937 | 6,805 | 2,272 |
| PAT Margin (%) | 4.15% | 5.80% | 6.65% | 7.67% | 4.10% | 6.77% | 4.88% |
| RoCE (%) | 14.83% | 12.77% | 21.49% | 53.25% | 15.15% | 18.37% | 16.18% |
| RoE (%) | 14.18% | 13.84% | 21.68% | 42.45% | 22.21% | 16.24% | 13.99% |
Valuation
Belrise Industries Ltd. is a Tier-1 Automotive OEM Manufacturing Group in India which specializes in Automotive Systems for the2W, 3W and 4W Passenger and CV niche. At the upper end of the price band of Rs. 90 the issue is priced at an PE of ~24.5x of its FY25E annualized earnings. The issue looks fully priced. One can subscribe this issue for listing gains.
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