Sona Comstar, a major Indian auto component manufacturer owned by PE fund Blackstone Group Inc. It is scheduled to raise around Rs 6000 crore through an initial public offer (IPO). This will be the biggest listing locally by the Indian auto components firm. Sona Comstar IPO will hit the market on 14 June 2021.
Table of Contents
About
The firm’s journey began in 1995 as Sona Okagawa Precision Forging, a 75:25 joint venture between the Sona Group and Mitsubishi Material and was a pioneer of hot lattice near net-shaped gears manufacturing technology.
The Sona group, after acquiring Thiesen Kroop’s forging business (which was the inventor of hot forging), and Mitsubishi’s 25% stake, changed the company name to Sona BLW Precision Forging, the largest manufacturer of forged gears.
In 2018, Blackstone acquired Chennai-based Comstar Automotive Technology for approximately Rs 1,000 crore. In 2019, Blackstone also acquired a 33% stake in Sunjay BLW, led by Sunjay Kapur, and merged the auto parts firm with Comstar to form Sona Comstar.
Facility
They have nine manufacturing and assembly facilities in India, China, Mexico and the United States, of which six manufacturing facilities are located in India. Their facilities in Chennai, China, Mexico and the United States focus on the production of our electric business products.
While other facilities in India focus on the production of their driveline trade products. Their facilities in India are building plants, facilities in the US, Mexico and China serve as satellite final assembly and finishing plants.
Clients
- Ampere Vehicles
- Ashok Leyland
- Daimler Geely
- Jaguar Land Rover
- Mahindra Electric
- Mahindra & Mahindra
- Maruti Suzuki
- Revolt Intellicorp
- Volvo Eicher
- Volvo Cars
Financials Trends
| Particulars | For the year/period ended ( in Cr.) | ||||
|---|---|---|---|---|---|
| 31-Dec-20 | 31-Mar-20 | 31-Mar-19 | 31-Mar-18 | ||
| Total Assets | 2,112.04 | 1,850.68 | 1,632.56 | 1,483.78 | |
| Total Revenue | 1,029.63 | 1,043.77 | 702.50 | 625.92 | |
| Profit After Tax | 155.47 | 360.34 | 173.18 | 77.57 | |
Basic and Diluted Earnings Per Share (EPS)
| Financial Period | Basic EPS (in INR) | Diluted EPS (in INR) | Weight |
| Financial Year 2020 | 7.06 | 7.06 | 3 |
| Financial Year 2019 | 5.20 | 5.20 | 2 |
| Financial Year 2018 | 2.33 | 2.33 | 1 |
| Weighted Average | 5.65 | 5.65 | |
| (9 months) Dec. 31, 2020 | 2.71 | 2.71 | – |
Issue
Sona Comstar, headquartered in Gurugram has submitted Draft Red Herring Prospectus(DRHP) to Securities and Exchange Board of India(SEBI) for initial public offering (IPO) of INR 6000 crore on 23 February, 2021.
The Offer includes a fresh equity of Rs. 300 crore and an offer for sale(OFS) up to Rs. 5700 cr. value equity shares of face value of 10 per share, by the promoters.
They got approval from Securities and Exchange Board of India(SEBI) on 10 May, 2021 to float the initial public offering (IPO) in the market.
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 issue
- One of the world’s major producers and providers of electric vehicles.
- One of the world’s leading firms, growing market share in key automotive geographies, technologies, vehicle segments, and clients.
- Strong technology and research and innovation capability in both hardware and software design.
- Excellent business growth with a focus on the consumer.
- Financial consistency based on industry-leading benchmarks.
- Board of directors and management team with great industry expertise.
IPO Details
| IPO Opening Date | 14 June 2021 |
| IPO Closing Date | 16 June 2021 |
| Issue Type | Book Built |
| Face Value | 10 per share |
| IPO Price | 285 to 291 per equity share |
| Market Lot | 51 |
| Min Order Quantity | 51 |
| Listing At | BSE, NSE |
| Issue Size | 6,000 cr |
| Fresh Issue | 300 cr. |
| Offer for Sale | 5700 cr. |
IPO Tentative Date
Sona Comstar IPO open date on 14 June 2021, and the close date on 16 june 2021. The issue may list on 24 June 2021.
| IPO Open Date | 14 June 2021 |
| IPO Close Date | 16 June 2021 |
| Basis of Allotment Date | 21 June 2021 |
| Initiation of Refunds | 22 June 2021 |
| Credit of Shares to Demat Account | 23 June 2021 |
| IPO Listing Date | 24 June 2021 |
Basis of Allotment
| Type | % of Offer | Basis of Allotment |
|---|---|---|
| Qualified Institutional Buyer | 75 |
Roughly
equivalent
|
| Non Institutional Investor | 15 |
Roughly
equivalent
|
| Retail | 10 | Minimum level of 1 lot, based on availability, for every shareholder. |
Sona Comstar IPO Allotment 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 Sona Comstar IPO.
Promoters
- Sunjay Kapur
- Sona Autocomp holding Private Limited
- Singapore VII Topco III PTE Limited
Promoter Holding
| Pre Issue Share Holding | 99.9% |
| Post Issue Share Holding |
Sona Comstar IPO GMP (Sona BLW ipo GMP)
Sona Comstar IPO Grey market premium is as follows and you can check GMP of other 4 IPOs as well from links given below:
| Date | GMP (in Rs) | Subject to Sauda | Kostak (in Rs) |
| 24 June 2021 | |||
| 23 June 2021 | 22 | 550 | |
| 22 June 2021 | 20 | 250 | |
| 21 June 2021 | 15 | 1200 | |
| 20 June 2021 | 12 | 750 | |
| 19 June 2021 | 9 | 500 | |
| 18 June 2021 | 5 | 1000 | |
| 17 June 2021 | 10 | 1500 | |
| 16 June 2021 | 25 | 4000 | |
| 15 June 2021 | 45 | 2500 | |
| 14 June 2021 | 75 | 3000 | |
| 13 June 2021 | 68 | 3500 | |
| 12 June 2021 | 65 | 2000 | |
| 11 June 2021 | 50 | 1500 | |
| 10 June 2021 | 70 | 2500 | |
| 09 June 2021 | 100 | ||
| 08 June 2021 | 150 |
Check The GMP Of other 4 IPOs
Sona Comstar IPO Review
You can apply with long term view as it they are in auto industry which mostly see huge ups and downs nowadays due to corona but company is stable and management is positive.
However, Listing gains might not be very good. So if you are only looking for listing gain then apply for maximum 1 lot.
Risk
The effectiveness of the automotive sector worldwide, particularly key regions such as United States, Europe, India, and China, is critical to the company’s success.
Global players who are larger and more financially powerful – CATPL is a small player in comparison to major incumbents like Robert Bosch GmbH, Mitsubishi Electric Corporation, Valeo, and Denso Corporation, and it confronts strong cost and product competitors from them.
The firm’s volumes are also significantly associated with the sales volumes of the models it caters to, due to its visibility on only a few networks. Transitions of its primary customer’s automotive engine platforms have previously affected income.
Brokerage views
- Yes Securities : only with long terms view
- Choice Brokering: only with long terms view
- Axis Securities: only with long terms view
- IIFL Securities: only with long terms view
- Trade swift: only with long terms view
- Anand Rathi : only with long terms view
- ICICI Securities: only with long terms view
Sona Comstar IPO Subscription
| Date | Day | QIB | NII | Retail | Employees | Total Subscription |
| 14 June 2021 | 1 | 0.02 | 0.01 | 0.52 | N/A | 0.11 |
| 15 June 2021 | 2 | 0.14 | 0.04 | 1.04 | N/A | 0.28 |
| 16 June 2021 | 3 | 3.54 | 0.40 | 1.61 | N/A | 2.33 |
Peer Comparison
| S. No. | Company Name | PE |
| 1 | Motherson Sumi Systems Limited | 59.49 |
| 2 | Sundaram-Clayton Limited | 21.52 |
| 3 | Varroc Engineering Limited | 41,000.00 |
| 4 | Bosch Limited | 71.91 |
| 5 | Bharat Forge Limited | 84.29 |
| 6 | Mahindra CIE | 21.00 |
Sona Comstar IPO Prospectus
Contact Details
Sona BLW Precision Forgings Limited
Sona Enclave Village, Begumpur Khatola,Sector 35,
Gurugram, Haryana – 122004, India
Tel: +91 0124 476 8200
E-mail: [email protected]
Website: https://www.sonacomstar.com/
Registrar
KFin Technologies Private Limited
Selenium Tower-B, Plot 31 & 32, Gachibowli
Financial District, Nanakramguda, Serilingampally
Hyderabad 500 032
Telangana, India
Tel: +91 40 6716 2222
E-mail: [email protected]
Website: www.kfintech.com
Lead Manager(s)
- Kotak Mahindra Capital Company Limited
- Credit Suisse Securities (India) Private Limited
- JM Financials limited
- Nomura Financial Advisory and Securities (India) Private Limited
- J.P. Morgan India Private Limited
We hope we are able to answer all your questions about the Sona Comstar IPO. If you don’t have a Demat account, open it now with Zerodha best trading app.
Renunciation
The reference of IPO Grey Market Premium (IPO GMP) is only valid for the date specified in the header.
On the IPO Grey Market, we do not purchase or sell IPO forms.
The Kostak Rate is the profit earned by selling an IPO application (in an off-market transaction) to somebody else before the issue is allotted or listed.
Do not subscribe to an IPO based solely on the premium price, as it may alter at any time before to the listing. Only consider the fundamentals of the companies when subscribing.
The GMP rates for IPOs are based on market intelligence. Please keep in mind that these IPO GMP rates may vary by geography and market.
Note:
We do not engage in grey market trading or facilitate the purchase or sale of IPO forms.
What is grey Market?
The phrase “grey market” refers to an illegal over-the-counter market where IPO applications and IPO stock are traded before the entity is listed on a stock exchange. This is a technique for dealers to help consumers who wish to sell their home before it goes on the market.
This is also a way to increase the listing fee and provide help for the issue prior to the listing. In the IPO grey market, there are two types of transactions that take place:
- IPO stocks are traded at a premium in the grey market.
- At a kostak, an IPO application is traded.
What is grey Market Premium?
The Grey Market Premium, or GMP, is the price at which IPO stock shares are exchanged in the grey market.
This could be correct or incorrect, implying that the grey market trading price is greater or cheaper than the issue price, depending on demand and supply for the stocks.
Typically, individuals who do not want to incur the risk of their shares not being allocated through an IPO can purchase shares on the grey market in the hopes of flipping them on the IPO for a profit.
What is Kostak?
The additional amount in rupees at which IPO applications are sold in the IPO Grey Market is known as kostak (or price of application). The bonus of a maximum lot retail application in an IPO is generally described as the ‘Kostak’ value.
The Kostak price is significant primarily before the offer is closed for subscription and the ultimate bidding status is made accessible to IPO participants. After the final auction status is known to investors, only a small percentage of IPO applications are exchanged.
‘Kostak’ is made for those who do not want to incur a risk on an IPO or gain from a listing.
Example:
Sona Comstar limited
Issue Price: Rs 306 Per Equity Share (Maximum Bid price)
Lot Size: 45
Grey Market Premium: Rs 220 to Rs 230
Kostak (Rs 13770): Rs 680 to Rs 720
This means Sona Comstar limited applications of Rs 13770 are being traded in IPO Grey Market at Rs 680 to Rs 720.
Despite the fact that this IPO’s Grey Market Premium is roughly 75% of the issue price, the ‘Kostak’ is just 5% of the application value.
Kostak rate
The Kostak rate is the fee received by an investor who sells his or her IPO application on the grey market. Regardless of allotment status, this is the money an individual stands to gain.
Subject to Sauda
The money that an investor stands to gain by selling his or her application for firm allotment is referred to as the subject to Sauda. Firm allocation is the important operative phrase here. The sauda will be cancelled if the applicant is not allotted.
When selling an IPO application in the grey market, the client and seller agree that the sale will only be legal if the seller receives the allocation. The deal is avoided if the seller does not get any stocks throughout the IPO procedure.
FAQ
Sona Comstar IPO Opening Date?
Sona Comstar IPO will open on 14 June 2021.
Sona Comstar IPO Listing Date?
Sona Comstar IPO will list on 24 june 2021.
Sona Comstar IPO GMP Today?
Sona Comstar IPO Grey Market Premium is INR 22.
Sona Comstar IPO Allotment Date?
Sona Comstar IPO basis of allotment will be on 21 June.
Lot size for Sona Comstar IPO?
Lot size for Sona Comstar IPO is 285 to 291.
