Diffusion Engineers Ltd
Diffusion Engineers Ltd, founded in 1982, is a leading player in the welding consumables and heavy engineering industry. The company specializes in providing welding consumables, wear-resistant plates, and reconditioning services for various sectors like steel, cement, mining, and power. Their innovative Super Conditioning process, which extends the lifespan of machine components, has given them a competitive edge in both domestic and international markets.
With the company’s IPO set to launch, investors have a chance to become a part of its growth journey. Here’s everything you need to know about the upcoming IPO.
Diffusion Engineers IPO Highlights
Diffusion Engineers Ltd IPO is scheduled to open on September 26, 2024, and close on September 30, 2024. The issue size is set at ₹158 crores, with a price band ranging between ₹159 and ₹168 per share. Investors can apply for a minimum of 88 shares per lot.
IPO key details
| IPO Details | Information |
| IPO Open Date | September 26, 2024 |
| IPO Close Date | September 30, 2024 |
| Price Band | ₹159 – ₹168 per share |
| Lot Size | 88 shares |
| Total Issue Size | ₹158 crores |
| Face Value | ₹10 per share |
| Employee Discount | ₹8 per share |
| Listing on | BSE, NSE |
| Listing Date | October 4, 2024 (Tentative) |
IPO Reservation
| Category | Percentage of Issue |
| Qualified Institutional Buyers (QIB) | 50% |
| Non-Institutional Investors (NII) | 15% |
| Retail Investors | 35% |
The funds raised from the IPO will be primarily used for the expansion of existing manufacturing facilities and setting up new units.
Diffusion Engineers Ltd – Financial Overview
Diffusion Engineers has demonstrated consistent financial performance over the past few years. The company saw a 10% increase in revenue and a 39% rise in Profit After Tax (PAT) between FY 2023 and FY 2024.
Financial Performance
| Year (₹ Crores) | Revenue | PAT | Assets | Net Worth |
| FY 2024 | ₹285.56 | ₹30.80 | ₹275.59 | ₹190.70 |
| FY 2023 | ₹258.67 | ₹22.15 | ₹230.34 | ₹142.00 |
| FY 2022 | ₹208.75 | ₹17.05 | ₹189.55 | ₹120.65 |
Diffusion Engineers maintains a Return on Equity (ROE) of 18.52%, with a PAT margin of 10.79%, reflecting its strong financial health.
Key Metrics
| Metric | Value |
| Return on Equity (ROE) | 18.52% |
| Return on Capital Employed (ROCE) | 20.63% |
| Debt/Equity Ratio | 0.18 |
| PAT Margin | 10.79% |
Grey Market Premium (GMP) and Market Sentiment
The Grey Market Premium (GMP) for Diffusion Engineers Ltd is drawing attention from investors, with reports suggesting a positive reception ahead of the listing. While the GMP fluctuates based on market sentiment, it often serves as an indicator of how the stock may perform once listed on the exchanges.
Why should you consider this IPO?
- Established Industry Leader: With over four decades of experience, Diffusion Engineers Ltd serves core industries like cement, mining, steel, and power, giving it a strong revenue base.
- Strong Financial Track Record: Consistent growth in revenue and profit, alongside solid returns on equity, make it an attractive investment.
- Expansion Potential: The proceeds from the IPO will be used to expand existing facilities and set up new manufacturing units, positioning the company for future growth.
Diffusion Engineers Ltd Business Model
Diffusion Engineers operates in both domestic and international markets, providing engineering solutions like welding consumables, wear plates, and specialized repair services for heavy machinery. Their Super Conditioning process is a standout innovation, improving the lifespan and wear resistance of critical machine components, leading to cost efficiency and longer equipment life for clients.
The company’s manufacturing operations are spread across multiple units in Nagpur, Maharashtra, with facilities focusing on welding electrodes, flux-cored wires, and abrasion-resistant coatings. Diffusion Engineers also trades in anti-wear powders and welding and cutting machines, making it a comprehensive player in the industrial engineering space.
Conclusion
With the Diffusion Engineers Ltd IPO around the corner, this offers investors an exciting opportunity to invest in a company with a strong financial foundation and expansion plans in place. Its diversified business model and industry reputation make it a promising candidate for long-term growth.
Keep an eye on the Grey Market Premium and subscription numbers to gauge market sentiment as the IPO approaches.
