DCX Systems IPO

DCX Systems Limited Limited is one of the leading Indian firms in the fabrication of electronic subsystems and cable harnesses in terms of the production capability and sales in Fiscal 2021(Source: F&S Report). DCX Systems IPO will hit the stock market in 31 October 2022.

About DCX Systems

DCX Systems is specialise in system integration as well as the manufacture of a wide range of cables and wire harness assemblies, as well as kitting. They began operations in 2011 and have since become a preferred Indian Offset Partner for foreign original equipment manufacturers when it comes to completing defence manufacturing projects.

They are a fast-growing corporation in the Indian defence sector, with revenue from operations increasing at a CAGR of 46.22 percent between Fiscal 2019 and Fiscal 2021.

They are also one of the largest Indian Offset Partners for ELTA Systems Limited and Israel Aerospace Industries Limited, System Missiles & Space Division, for the production of electronic subsystems and cable and wire harness configurations for the Indian defence market.

Growth

They’ve increased their manufacturing capacity and increased their order book. The rising Indian defence and aerospace sector presents a significant opportunity for their company.

By 2030, India’s aerospace and defence industry is expected to be worth USD 70 billion. Recent measures, such as the automatic rise in foreign direct investment in the Indian defence sector from 49 percent to 74 percent, are expected to be a key driver and growth opportunity for the market.

The Defense Research and Creation Organization has announced the development of 108 systems and subsystems in-house, which is projected to increase demand for cables and connectors in the Indian defence environment.

In addition, the Indian government has blacklisted around 101 products from the defense-related imports category.

Production

India’s indigenous manufacturing is projected to benefit from these initiatives. The establishment of military industrial corridors in Uttar Pradesh and Tamil Nadu is also expected to improve market growth dynamics by expanding private sector opportunities.

All of this, in turn, provides them with an opportunity to profit from the predicted expansion in this market. Their competitive advantages, they say, are their operational efficiency, which results in prompt delivery to their clients, quality control, and product security.

This has allowed them to cultivate long-term and established partnerships with its OEM customers, resulting in increased operations and a large order book.

They anticipate their quality management systems to allow them to achieve system-driven efficiency and continue to attract higher revenues going forward.

DCX Systems IPO

DCX Systems Limited Limited, headquartered in Mumbai has submitted Draft Red Herring Prospectus(DRHP) to Securities and Exchange Board of India(SEBI) for initial public offering (IPO) of 600 Crore on 04 April 2022.

The offer includes a fresh issue 500 crore and there is offer for sale (OFS) of 100 Crore by the promoters mentioned in the DRHP. They are also looking for a Pre-IPO placement 50 crore in this issue.

They got the for approval from Securities and Exchange Board of India(SEBI) to float the initial public offering (IPO) in the market.

Financials Trends

Particulars	For the year/period ended ( in Cr.)
	30-Sep-21	31-Mar-21	31-Mar-20	31-Mar-19
Total Assets	763.13	793.18	698.85	488.95
Total Revenue	749.25	683.24	465.23	309.07
Profit After Tax	33.20	29.56	9.74	4.59

Basic and Diluted Earnings Per Share

Financial Period	Basic EPS (in INR)	Diluted EPS (in INR)	Weight
Financial Year 2021	0.66	0.66	3
Financial Year 2020	1.39	1.39	2
Financial Year 2019	4.22	4.22	1
Weighted Average	2.68	2.68
30 Sep. 2021	4.74	4.74

Objects of the Issue

• Prepayment / repayment of all or a portion of the outstanding borrowings of the company to be availed on consolidated basis.
• To meet common corporate objectives.

Basis of the offer

They feel that the following qualitative factors & business strengths enable them to compete successfully in the industry and used to calculate the Offer Price:

• With global accreditations, it is one of the most chosen Indian offset players for the defence and aerospace industries.
• End-to-end capabilities that are enabled by technology and scalable.
• Business model that allows for cash flow visibility and the mitigation of operational and technological risk.
• With an innovative and contemporary production facility, it is strategically placed in the Special Aerospace Economic Zone.
• The company is well-positioned to benefit from industry tailwinds.
• Consistent financial performance in the past.
• Promoters with extensive experience and qualifications, as well as a senior management team, are backed up by a dedicated workforce.

DCX Systems Peer Comparison

S. No.	Face Value	Company Name	PE
1	5	Bharat Electronics Limited	23.79
2	10	Data Patterns (India) Limited	63.02
3	10	Paras Defence and Space Technologies Limited	115.05
4	10	Astra Microwave Products Limited	64.19
5	10	Centum Electronics Limited	32.05

1. All financial data for listed industry peers is on a standalone/consolidated basis and comes from the audited consolidated/standalone financial statements of the respective firms for the year ending March 31, 2021, which can be found on the Stock Exchanges’ websites.
2. The P/E ratio is calculated by dividing the closing market price of equity shares on the BSE on March 28, 2022 by the diluted EPS derived from the peer group company’s annual report for the year ended March 31, 2021.

DCX Systems IPO Details

IPO Opening Date	31 October 2022
IPO Closing Date	02 November 2022
Issue Type	Book Building
Face Value	2 per share
IPO Price	197 to 207 per equity share
Market Lot	72
Min Amount	14,904
Listing At	BSE, NSE
Issue Size	600 Crore
Fresh Issue	500 Crore
Offer for Sale	100 Crore

DCX Systems IPO Date

DCX Systems Limited IPO opening date is 31 October 2022, and the closing date is 02 November 2022. The DCX Systems issue may list in 11 November 2022.

IPO Opening Date	31 October 2022
IPO Closing Date	02 November 2022
Basis of Allotment Date	07 November 2022
Initiation of Refunds	09 November 2022
Credit of Shares to Demat Account	10 November 2022
IPO Listing Date	11 November 2022

Basis of Allotment

Type	% of Offer	Basis of Allotment
Qualified Institutional Buyer	75	Roughly  equivalent
Non Institutional Investor	15	Roughly  equivalent
Retail	10	Minimum 1 lot based on availability

DCX Systems Limited IPO Status

Allotment of equity stocks subject to the Fresh Issue and transfer of the Promoter Selling Shareholders’ OFS Stocks to the winning Bidders subject to the Offer for Sale. Nevertheless, the status of the allotment has yet to be revealed.

Here, you can find the Allotment Status of DCX Systems IPO.

DCX Systems IPO GMP

DCX Systems Limited IPO Grey Market Premium is 0. You can check out GMP of Other IPOs on below Links:

Date	GMP (in Rs)	Subject to Sauda	Kostak (in Rs)
November 2022
November 2022
November 2022
November 2022
November 2022
November 2022
October 2022
October 2022
October 2022
October 2022
October 2022
25 October 2022

Check Out the GMP of all Other IPOs

IPO Grey Market Premium

DCX Systems Limited IPO Review

DCX Systems Limited IPO review : The answer to your question that DCX Systems IPO is good or bad is you can apply for this IPO with long term view.

DCX Systems Limited IPO Risk

• Their operational revenue is heavily reliant on offset defence contracts.
• Their current order book may or may not translate into full revenue in the future.
• Significant shortages of, or delays or disruptions in the delivery of, raw materials could have a material negative impact on their expected expenses, expenditures, and timeframes, which could harm their firm.
• They are reliant on the electronic subsystems market’s performance.
• They rely on the smooth operation of their production facility, and any slowdown, stoppage, or disturbance in that facility could cause business difficulties.
• They may be unable to get furnished equipment needed for testing and qualifying products from customers, which could have a significant negative impact on their business, results of operations and financial condition.

Other Threats

1. DCX Systems do not own the ‘DCX’ trademark. They utilise the brand name ‘DCX’ since DCX-Chol Enterprises, Inc. sent them a no objection letter.
2. They are vulnerable to foreign currency fluctuation risks, notably in respect to their borrowings, raw material imports, and product exports, which could negatively impact their operating results.
3. Their inability to manage the risks involved with their export sales could hurt their sales to international customers.
4. They have accumulated debt, and failure to meet repayment and other conditions in their financing arrangements could have a negative impact on their firm.
5. Any drop in their credit scores could raise their borrowing costs, limit their capacity to secure finance, and harm their firm, results of operations and financial condition.

DCX Systems Limited IPO Brokerage views

Once the dates will be announced we will update the views of different brokerage firms regarding this IPO. Here is the views of different stock brokers regarding this DCX Systems IPO:

• Yes Securities : Not Updated
• Choice Brokering: Not Updated
• Axis Securities: Not Updated
• IIFL Securities: Not Updated
• Trade swift: Not Updated
• Anand Rathi : Not Updated
• ICICI Securities: Not Updated

DCX Systems Limited IPO Subscription Status

Date	Day	QIB	NII	Retail	Employees	Total Subscription
31 October 2022	1
01 November 2022	2
02 November 2022	3

DCX Systems Limited Management

DCX Systems Limited is led by seasoned Promoters and a highly qualified senior management team with extensive expertise in the aerospace and defence industries.

Dr. H.S. Raghavendra Rao, the company’s Individual Promoter, Chairman, and Managing Director, has over two decades of experience in electronics manufacturing as well as the defence and aerospace industries.

Their Non-Independent and Non-Executive Director, Neal Jeremy Castleman, has over two decades of experience in the electronic manufacturing industry.

Their senior management team has a track record of anticipating and capitalising on changing market trends, managing and growing their operations, and leveraging and deepening client connections.

Sankarakrishnan Ramalingam, DCX systems’s full-time director, has over 26 years of expertise in the banking industry and related activities.

DCX Systems Limited‘ Promoters

• Dr. H. S. Raghavendra Rao
• NCBG Holdings Inc.
• VNG Technology Private Limited

Promoter’s Holding

Pre Issue Share Holding	98.20%
Post Issue Share Holding

DCX Systems Limited Prospectus