Introduction to Indo Farm Equipment Limited
As 2024 winds down, Indo Farm Equipment Limited is set to launch its much-anticipated IPO, potentially marking the last public issue of the year. With a total issue size of ₹260.15 crore, this IPO could offer investors an exciting entry into the agriculture and construction equipment sector.
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A brief history of Indo Farm Equipment Limited
Founded in 1994, Indo Farm Equipment Limited has grown into a prominent manufacturer of tractors, pick-and-carry cranes, and harvesting equipment. The company operates under two key brands – Indo Farm and Indo Power – and exports products to countries including Nepal, Syria, Bangladesh, and Sudan.
Indo Farm’s manufacturing facility, located in Baddi, Himachal Pradesh, spans over 127,840 sq. meters and can produce up to 12,000 tractors and 1,280 cranes annually. The company is now focusing on expanding crane production by 3,600 units through the acquisition of new industrial land.
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Why is Indo Farm Equipment going public?
The IPO aims to raise capital to drive the company’s next phase of growth. Here’s how the funds will be used:
- Expand crane production – Indo Farm plans to set up a dedicated facility to meet rising demand.
- Repay borrowings – A significant portion will be used to clear existing debts.
- Invest in NBFC arm – Additional funds will boost Barota Finance Ltd., Indo Farm’s in-house NBFC.
- General corporate purposes – A smaller share of the proceeds will be used for day-to-day operational needs.
Indo Farm Equipment – IPO details
| Particulars | Details |
| IPO Size | ₹260.15 crore |
| Fresh Issue | ₹184.90 crore |
| Offer for Sale (OFS) | ₹75.25 crore |
| Price Band | ₹204 – ₹215 per share |
| Lot Size | 69 shares |
| IPO Opening Date | December 31, 2024 |
| IPO Closing Date | January 2, 2025 |
| Listing Date (Tentative) | January 7, 2025 |
| Listing Exchanges | BSE, NSE |
| Lead Manager | Aryaman Financial Services |
| Registrar | Mas Services Ltd. |
Indo Farm Equipment – Financial performance
| Year | Revenue (₹ Cr) | Profit After Tax (₹ Cr) | Total Assets (₹ Cr) | Net Worth (₹ Cr) |
| 31 Mar 2022 | 352.52 | 13.72 | 619.83 | 274.8 |
| 31 Mar 2023 | 371.82 | 15.37 | 622.84 | 290.37 |
| 31 Mar 2024 | 375.95 | 15.6 | 647.95 | 317.06 |
| 30 Jun 2024 | 75.54 | 2.45 | 644.27 | 342.25 |
Shareholding pattern – Before and after IPO
| Category | Pre-Issue (%) | Post-Issue (%) |
| Promoters | 93.45% | 69.44% |
| Public (Retail, HNI) | 6.55% | 30.56% |
Fund utilisation plan
| Purpose | Amount (₹ Cr) |
| Crane capacity expansion | ₹71.13 |
| Debt repayment/prepayment | ₹40.00 |
| Investment in Barota Finance Ltd. | ₹60.00 |
| General corporate purposes | ₹13.77 |
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Why invest in Indo Farm’s IPO?
Advantages:
- Diversified portfolio – Strong offerings in tractors, cranes, and farm equipment.
- Export reach – Sales to markets like Nepal, Myanmar, and Sudan.
- Proven track record – Consistent financial growth and market expansion.
- Capacity expansion – Plans to increase crane production by 3,600 units per year.
Risks to consider:
- Thin profit margins – Indo Farm operates at a PAT margin of 4.16%.
- Debt levels – Borrowings stand at ₹245.36 crore.
- Competitive market – Facing competition from major players like Escorts Kubota.
Bottomline
Indo Farm Equipment Limited’s IPO could present a unique investment opportunity, especially for those interested in the agriculture and construction equipment sector. With planned expansion, export market growth, and a track record of solid performance, Indo Farm might be worth considering for long-term gains. However, investors should carefully assess profit margins and debt levels before making their final decision.
