Carraro India IPO: Italy's Carraro Group-owned firm files draft papers for Rs 1,812 crore IPO with SEBI

Manufacturer of axles and transmission systems for agricultural tractors and construction vehicles, Carraro India, has announced plans to raise Rs 1,811.65 crore through an initial public offering (IPO). 

The auto parts manufacturer has filed a draft red herring prospectus (DRHP) with SEBI on August 23. The IPO with a face value of Rs 10 each, is a complete offer for sale (OFS) of up to Rs 1,811.65 crore by Carraro International SE, according to the disclosure. 

The IPO will consist entirely of an offer for sale (OFS) issue by the company’s promoter, Carraro International S E, a holding entity under the Carraro SpA group. As a result, all proceeds from the offering will go to the selling shareholder, with Carraro India not retaining any funds from the IPO. 

Based in Italy, Carraro SpA is the parent organisation of the Carraro Group, which specialises in manufacturing transmission systems — such as axles, transmissions, and drives — used in agricultural and construction equipment for off-highway vehicles. 

The company operates two manufacturing plants in Pune and supplies products to 38 manufacturers in India. In FY24, it generated 64.82 percent of revenues from domestic sales in the last financial year. 

The company’s profit for the FY24 stood at Rs 60.6 crore up by 29.4 percent compared to Rs 47 crore in FY23. Carraro posted a 4.4 percent growth in revenue for FY24 at Rs 1,770.5 crore. Its EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 27.2 percent on-year to Rs 128.2 crore.  

Axis Capital, BNP Paribas, and Nuvama Wealth Management are acting as the merchant bankers to the issue. 

Founded in 1997, Carraro India competes with Escorts Kubota, Schaeffler India, Sona BLW Precision Forgings, Ramakrishna Forgings, Happy Forgings, and Action Construction Equipment.  

Its product lineup includes backhoe loaders, soil compactors, cranes, self-loading concrete mixers, and small motor graders catering to both the agricultural and construction sectors. Additionally, Carraro India supplies gears, shafts, and ring gears for industrial and automotive vehicles.