Incorporated in 1991, Jyoti CNC Automation Limited is one of the world’s leading metal-cutting computer numerical control (CNC) machines manufacturer. It held the third largest market share in India in FY23 and the twelfth largest market share globally in 2022.
Its portfolio of CNC machines includes CNC Turning Centers, CNC Turn Mill Centers, CNC Vertical Machining Centers (VMCs) and CNC Horizontal Machining Centers (HMCs). It offers over 200 variants across 44 series and has supplied over 30,000 CNC machines globally since 1 April 2004.
In the last three fiscals and the 6 month period ended September 2023, it sold its products to 3,500 customers based in India and across 16 other countries based in Asia, Europe, North America and the rest of the world. It has principal offices in India, France, Germany, Turkey and Canada, and sells its products in Romania, France, Poland, Belgium, Italy, and the United Kingdom through Huron’s established dealer network. It also has 29 sales and service centres spread across 12 states in India.
Some of its customers include ISRO, BrahMos Aerospace Thiruvananthapuram, Turkish Aerospace, Uniparts India, AVTEC, Tata Advanced System, Tata Sikorsky Aerospace, Bharat Forge, C.R.I. Pumps, Kalyani Technoforge, Shakti Pumps (India), Shreeram Aerospace & Defence LLP and Rolex Rings.
It operates three manufacturing facilities - 2 in Gujarat and 1 in Strasbourg, France with the capacity to manufacture 4,400 machines per annum in India and 121 machines per annum in France as of 30 September 2023. Its R&D facility is situated in Rajkot, Gujarat, along with an R&D team in Strasbourg, France. As of 30 September 2023, its R&D team aggregated 141 employees in Rajkot, Gujarat and Strasbourg, France.
Between FY21 and FY23, it saw a CAGR rise of 17% in its revenue from operations. As of 30 September 2023, its order book accounted for ₹3,315 crore. Moreover, the CNC machine market is expected to grow globally at a CAGR of 10% between 2023 and 2027, which could be beneficial for the company.
And now, Jyoti CNC Automation Limited is coming out with its initial public offer (IPO). The IPO will be a fresh issue and the money will be utilised to repay borrowings, fund long-term working capital requirements and for general corporate purposes. Its shares will be listed on the NSE and the BSE.
Jyoti CNC Automation IPO Details:
Company Name — Jyoti CNC Automation Limited
Company Type — Private
Company Established — 1991
Jyoti CNC Automation Ltd IPO Open Date — 9th January 2024
Jyoti CNC Automation Ltd IPO Close Date — 11th January 2024
Jyoti CNC Automation Ltd IPO Allotment Status — 12th January 2024
Credit of Shares to Demat — 15th January 2024
Jyoti CNC Automation Ltd IPO Listing Date — 16th January 2024
Jyoti CNC Automation Ltd IPO Face Value — ₹2 per share
Jyoti CNC Automation Ltd IPO Lot size — 45 shares
Jyoti CNC Automation Ltd IPO Issue Size — Approx ₹1000 crore
Jyoti CNC Automation Ltd IPO Listed at — NSE, BSE
Jyoti CNC Automation Ltd IPO Price — ₹315 – ₹331 per share
Financial snapshot
| ₹ crore | FY21 | FY22 | FY23 |
|---|---|---|---|
| Revenue | 580 | 746 | 929 |
| Net profit | -70 | -48.3 | 15.0 |
Strengths
- One of the leading CNC machine manufacturing companies with ~10% market share in India in FY23 and a prominent manufacturer of simultaneous 5-axis CNC machines in India.
- Has been recognised as ‘Best Brand in the Metal Cutting Industry’ by the Economic Times for five consecutive years from 2018 to 2022.
- Well diversified global customer base as it supplied over 8,400 machines to more than 3,500 customers in India and abroad during the 6 months period ended 30 September 2023 and the last 3 Fiscals.
- Spread across diverse end-user industries such as Aerospace and Defense, Auto & auto components, General Engineering, Dies & Moulds, EMS and others.
- Focus on technology as its product portfolio comprises entry-level products to sophisticated machines, including high-speed simultaneous 5-Axis, multi-purpose, multi-tasking machines. Additionally, it acquired Huron Graffenstaden SAS, a worldwide pioneer in the 5-Axis machining technology, in November 2007.
- Vertically integrated operations, including captive foundry, machining, sheet metal unit, paint shop and assembly unit.
Risks and threats
- Has incurred losses amassing to ₹70 crore and ₹48 crore in FY21 and FY22 respectively, primarily due to losses incurred by its subsidiaries.
- It does not enter into long-term purchase contracts with its customers.
- Has incurred significant indebtedness with total borrowings amounting to ₹834 crore in FY23 and total outstanding indebtedness amounting to ₹976 crore as of 30 September 2023.
- Has a large workforce of 2,624 employees as of 30 September 2023 and its employee benefit expense constituted ~17% of its total expense.
- It sources some of its input materials from international suppliers exposing it to the risk of forex rate fluctuations.
- Capital-intensive business with a working capital requirement of ₹552 crore as of 31 March 2023.
- Operates in the capital goods industry which is sensitive to general economic downturns.
- COVID-19 had an adverse material effect on the machine tools industry.
You can now apply for the Jyoti CNC Automation IPO on Upstox here.