Uniparts India Limited - IPO Note


Uniparts India Limited - IPO Note


Price range
Rs. 548-577
Issue Period:
Nov 30, 2022
Dec 02, 2022
December 01, 2022

Stock Info

CNX Nifty
Face value (Rs.)
Market lot
Issue size
Rs. 836 cr.
Public Issue
1.4 cr. shares
Market cap post IPO
2604 cr.
Equity Pre - IPO
4.5 cr.
Equity Post - IPO
4.5 cr.
Issue type
Offer for Sale

Shareholding (Pre IPO)

Source: Ace equity, StockAxis Research

Shareholding (Post IPO)

Source: Ace equity, StockAxis Research

Company Description

Uniparts India Limited (UIL) was incorporated on September 26, 1994. UIL is a global manufacturer of engineered systems and solutions. It is one of the leading suppliers of systems and components for the off-highway market in the agriculture and construction, forestry, and mining. Currently, it is present in 25 countries. The company’s product portfolio consists 3-point linkage systems (3PL), precision machined parts (PMP) along with power take off (PTO), fabrications and hydraulic cylinders. They serve some of the largest global companies.

Uniparts had an estimated 16.68% market share of the global 3PL market in FY22 in terms of value and an estimated 5.92% market share in the global PMP market in FY22 in terms of value (source: RHP). They also service aftermarket segment especially for 3PL product range through organized aftermarket retailers and distributors in North America, Europe, South Africa, and Australia. Together 3PL and PMP contribute to more than 90% of UILs revenue.

Geography-wise revenue mix

  Q1 FY23   FY22   FY21   FY20  
Particulars Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations
USA 169.73 48.94% 575.77 46.91% 434.92 48.16% 518.99 57.21%
Europe 79.38 22.89% 310.93 25.33% 210.63 23.32% 165.03 18.19%
India 48.96 14.12% 164.69 13.42% 143.33 15.87% 114.60 12.63%
Japan 16.53 4.77% 59.95 4.88% 40.83 4.52% 42.08 4.64%
Asia-Pacific 8.95 2.58% 27.24 2.22% 16.93 1.87% 16.68 1.84%
Rest of the world 10.38 2.99% 38.19 3.11% 22.23 2.46% 15.24 1.68%
Total 333.93 96.29% 1176.8 95.87% 868.87 96.20% 872.62 96.19%

Source: Company RHP

Manufacturing Facility:
The company has five manufacturing facilities including the overseas facility.

Capacity utilisation from FY20-Q1 FY23 table

Q1FY23 FY22 FY21 FY20
Manufacturing facility Production capacity (in tonnes) Capacity utilization (%) Production capacity (in Tonnes) Capacity utilization (%) Production capacity (in Tonnes) Capacity utilization (%) Production capacity (in Tonnes) Capacity utilization (%)
B208, Noida 2538 67.69% 12357 82.38% 9551 63.68% 8944 54.21%
GFPL, Noida 1623 77.27% 7028 83.67% 5045 70.07% 4629 70.13%
Vishakhapatnam 2456 73.08% 11046 82.19% 7911 58.86% 8380 62.35%
Framparts, Ludhiana 2338 90.11% 10133 101.13% 7698 81.03% 6250 69.44%
SKG, Ludhiama 2808 74.87% 11746 78.31% 9602 71.13% 8137 67.81%
Elride, USA 559 43.84% 2486 48.75% 2397 47% 3959 54.99%

Source: Company RHP

Understanding Product Offerings

  1. 3Point Linkage (PL): The 3PL system forms a group of assemblies allowing an implement like a plough to be attached to the tractor at 3 coupling points, forming a triangle.
    Uniparts India
  2. Precision Machine Parts (PML): PMP is a group of components that require specific material and manufacturing and undergoes various specifications and controls. It is used in applications across OHVs (Off-Highway Vehicles), ranging from engine parts and transmission components to specific parts for joints in agricultural and construction applications.
    Uniparts India
  3. Hydraulic cylinders: Hydraulic cylinders are used as actuators to move mechanized components, by generating linear motion along an axis. Hydraulic cylinders are powered by a fluid, typically oil.
  4. Power Take Off : PTO is a device used to drive implements such as rotary tillers, mowers and other equipment requiring a mechanical drive by the tractor. The PTO transmits power from the tractor to the implement and is used to distribute the power within the machine.
    Uniparts India
  5. Fabrication: The use of fabrications is majorly across Agriculture and construction industry. These parts vary in terms of size as well as design specifications and manufacturing process precision and complexity levels.

Product-wise revenue breakup from FY20-Q1 FY23

Q1 FY23 FY22 FY21 FY20
Particulars Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations
3PL 199.8 57.60% 683.96 55.72% 506.66 56.10% 427.96 47.17%
PMP 122.99 35.46% 447.12 36.43% 339.73 37.62% 432.31 47.65%
PTO applications 2.95 0.85% 12.23 1.00% 8.21 0.91% 6.45 0.71%
Fabrication 2.71 0.79% 13.00 1.06% 8.41 0.93% 7.72 0.85%
Hydraulic Cylinders 0.13 0.04% 0.72 0.06% 0.79 0.09% 0.67 0.07%
Others 18.25 5.26% 70.4 5.74% 39.35 4.36% 32.12 3.54%
Total 346.83 100.00% 1227.4 100.01% 903.15 100.01% 907.23 99.99%

Source: Company RHP

  • Vertically integrated solutions provider
    The company is a leading manufacturer of various precision components, where the major products are 3PL & PMP followed by fabrications, PTO and Hydraulic cylinders. The company is fully integrated both forward and backward integration that reduces its dependence on external suppliers.

    Over the years the company has transformed from being solely a component manufacturer to solutions provider and further to a systems integrator. They have diversified there product portfolio by including several products such as rear hitch, front hitch, hydraulic lift arms, PTOs and trailer hitch which allow them to offer integrated system solutions to meet customer requirements and move up the value chain. The company often collaborates with their key customers, to understand customers requirement regarding design and various product specifications and customises the product as per the customer’s needs.
  • Long-term relationships with key global customers, including major original equipment manufacturers (OEMs):
    UIL has strong and long-term relationships with global OEM players in the agriculture and CFM sectors, such as, LS Mtron Limited ,Doosan Bobcat North America (Bobcat), Claas Agricultural Machinery Private Limited (Claas Tractors), Yanmar Global Expert Co. (Yanmar) and Tractors & Farm Equipment Limited (TAFE) Ltd. It serves several organized aftermarket players and large retail store chains in different parts of the world such as Europe and US. players such as Kramp Groep B.V. (Kramp) and Tractor Supply Company (TSC).

    In FY22, the customer base of the company accounted for over 125 customers located across 25 countries globally. Customers such as Bobcat, TAFE and Kramp are associated with the company for over 15 years, while other customers like Yanmar, has a relationship for over 10 years.

    The share of OEMs and others in the revenue is~ 76% and 24%respectively.
Uniparts India

Source: Stockaxis Research

Rigorous innovation, engineering and design to strengthen product portfolio
The company is a component manufacturer where precision engineering and innovation in design are the integral parts of the process. Over the years they have made several design innovations according to the customer specifications and technological changes adapted by industry to serve diverse set of customers across the globe. This has aided in expanding there product and customer portfolio. They are also focusing on opportunities of collaboration and inorganic growth. The company is continuously working towards increasing the sales of high revenue generating products like 3PL, which has horsepower of more than 60HP for tractor segment along with other products like hydraulic cylinders, PTO applications and PMP . UILs biggest strength is they continuously focus on strengthening there existing portfolio and apply the latest advancements in that product, to provide best in class quality to their customers.

Revenue breakup (user industry)

Q1 FY23 FY22 FY21 FY20
Particulars Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations
Agriculture segment 244.74 70.56% 865.48 70.51% 630.38 69.80% 544.16 59.98%
CFM segment 85.2 24.56% 304.88 24.84% 237.27 26.26% 324.46 35.76%
Others 3.98 1.15% 6.42 0.52% 1.22 0.13% 3.98 0.43%
Total 333.92 96.27% 1176.78 95.87% 868.87 96.19% 872.60 96.17%

Source: Company RHP

Healthy Financial Position
The company has strong balance sheet with net worth of ₹ 713.93 crore as of June 30, 2022 and have maintained a low debt position. They have efficiently utilized their resources, which has enabled them to fun there capital expenditures. The revenue from operations of the company has shown significant growth on account of increased sales volume in Agriculture segment products. The revenue of the company stood at Rs 1227 cr in FY22 as against Rs 907 cr in FY20, an increase of 35%.

Strategic business model aids in maintaining leading market presence and cost-effectiveness into the business:
It has a three layer business model, which makes operations for the customers and business much efficient and easier. Various channels of delivery helps the company in smooth and fast operations of the business. Company’s India-led manufacturing and overseas-led warehousing coupled with direct customer service capabilities have been a key driver for the growth of their operations. This is evident as company has implemented ‘manufacturing in India and warehousing in US/Europe is 20% cheaper than manufacturing in US/Europe’. This strategic approach in the business has rewarded the company with significant cost-effectiveness. To further improve profitability UPIL reduced the capacity of its US facility from 7,200 TPA in FY20 to 5,100 TPA in FY21 and increased the sourcing from India. Due to diverse channels of delivery company enjoys the privilege of charging different margins depending upon the type of channel. With various channels for supply, the company is able to fulfil the demand of its OEM (Original equipment manufacturers) globally.

Sales Channel mix

Q1 FY23 FY22 FY21 FY20
Particulars Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations Revenue (in Cr) % of Revenue from Operations
International sales 284.96 82.16% 1012.09 82.46% 725.54 80.33% 758.00 83.55%
Local Deliveries 86.38 24.91% 296.64 24.17% 254.7 28.20% 294.56 32.47%
Direct Exports 105.12 30.31% 389.36 31.72% 242.85 26.89% 206.50 22.76%
Warehouse sales 142.24 41.06% 490.78 39.98% 371.31 41.11% 371.54 40.95%

Source: Company RHP

Peer Comparison

Company name Total revenue FY22 (Cr) EBITDA (Cr) FY22 PAT (Cr) FY22 EPS-Basic (Rs) FY22 PE (x) FY22 RoNW% FY22 Net Debt/EBITDA FY22 ROCE (%)FY22
Uniparts India Ltd. 1231.04 271.66 166.89 37.74 15.29 24.35% 0.42 31.00%
Bharat Forge Ltd 10656.98 2363.63 1077.06 23.23 36.73 16.25% 1.29 15.84%
Ramkrishna Forging Ltd. 2321.71 518.45 198.03 12.43 18.60 18.36% 2.90 13.42%

Note: The PE valuation for Uniparts India is calculated at Upper price band of Rs 577.
Source: Company RHP


  • Capital intensive and competitive industry
    The company deals in an capital intensive industry where technological advancements are persistent and heavy capital expenditures are required for expansion of the business. Also it has to keep itself updated with latest technological advancements which bring change in the industry trends.
  • Concentrated customer base
    According to management, it’s top customer (John Deere) accounted for 33% of its total revenue in FY22 & the next 5 customers accounted for another 30-40% of total top line. Hence top 10 customers make up around 75% of revenue clearly showing that the company is dependent on limited number of customers. Any adverse impact on its existing customer base will severely hamper revenue growth of the company.


Uniparts India Ltd. is a leading manufacturer of precision components used extensively across agriculture and CFM (Construction, Forestry and Mining) industries along with other industry segments. The company’s financial growth is impressive in past 3 fiscal years in terms of its revenue, PAT and EPS growth with lower levels of debt on its balance sheet.

We believe the company has potential to continue in its strong growth trajectory in future. At upper band IPO price of Rs 577/ share asking valuation is 15.3x of its FY22 earnings which looks reasonabl0065.

We recommend ‘SUBSCRIBE’ rating to the IPO offer.

Key Information

Use of Proceeds:

  1. The offer is purely an ‘Offer for Sale’ of up to 14,481,942 Equity Shares by the Selling Shareholders and the company intends to garner Rs 836 cr from this issue.
  2. Achieve the benefits of listing the Equity Shares on the Stock Exchanges. Since the offer is an ‘Offer for Sale’ the company will not receive any proceeds from the Offer and all such proceeds (net of any Offer related expenses to be borne by the Selling Shareholders) will go to the Selling Shareholders.

Book running lead managers:
Axis Capital Limited DAM Capital Advisors Limited JM Financial Limited

Gurdeep Soni (Promoter, Chairman and Managing Director), Paramjit Singh Soni (Promoter, Executive Director and Vice Chairman) Sudhakar S Kolli (Chief Operating Officer)

Financial Statement

Profit & Loss Statement:- (Consolidated)

Particulars Q1 FY23 FY22 FY21 FY20
Equity share capital 44.62 44.62 44.62 44.62
Reserves 669.31 640.62 515.52 419.55
Revenue from operations 346.84 1227.42 903.14 907.22
Reveneue Growth (%) - 35.91% -0.45% -
EBITDA 76.12 271.66 163.93 127.81
EBITDA margin (%) 21.95% 22.13% 18.15% 14.09%
Profit before tax 65.19 229.32 118.56 74.40
Net profit 50.52 166.89 93.15 62.64
Net profit margin (%) 14.56% 13.60% 10.31% 6.90%
EPS- Basic 11.42 37.74 21.12 14.20
EPS- Diluted 11.19 36.98 20.64 13.88
RONW (%) 7.08% 24.35% 16.63% 13.50%
ROCE (%) 8.83% 31.00% 19.78% 13.98%
Debt/ Equity 0.16 0.18 0.22 0.57