Indo-MIM Stock Market Debut: Fresh from a stellar stock market debut, precision engineering components maker Indo-MIM is betting on strong demand from the defence, aerospace and medical sectors to drive its next phase of growth, with the company stating it has sufficient capacity and capabilities to support future expansion.
Shares of Indo-MIM Ltd on Thursday made a remarkable stock market debut, listing with a premium of nearly 45 per cent, against the issue price of Rs 485. It ended with a premium of nearly 53 per cent.
Speaking to ET NOW after the company’s shares listed at a 46 per cent premium, Chief Financial Officer P. Balasubramanian discussed the company’s long-term growth strategy, opportunities in defence, aerospace, medical devices and gas turbines, capacity expansion, and why management remains confident about sustaining growth.
He said Indo-MIM expects the defence and medical businesses to outperform its other segments over the coming years. He further stated the company operates across three core technologies – metal injection moulding (MIM), investment casting and 3D printing – and serves customers in the automotive, medical, defence, aerospace and consumer industries.
“We are seeing great growth as a company and as an industry, we are seeing great growth in defence and medical. We expect these industries to outperform other industries that we are in,” Balasubramanian said.
He stressed that the government’s Production Linked Incentive (PLI) scheme has also created opportunities in the consumer manufacturing space, with more companies setting up operations in India.
“Consumer industry is new to India. Thanks to the PLI scheme of government of India, there are more and more industries coming into this segment and that also throws up interesting opportunities for us as a company. So, we feel on the whole, this three are the major segments in which we are operating and seeing good growth and Indo-MIM also will stand to gain on account of that,” he added.
On the sustainability of growth, Indo-MIM CFO said the company does not foresee any execution-related challenges despite its ambitious expansion plans.
“The kind of growth projections that we are mentally thinking is such that we’ll be able to handle it comfortably. We have good capacity utilization number. Our main capacity utilization is about 45 per cent to 50 per cent currently and it’s growing up. We have sufficient capacity inside the company and we have the capability. We are the largest manufacturer of metal injection moulded components in the world. So, there is nothing that we cannot do in MIM technology that anybody else can do better than us. So, we don’t see any challenges as far as our main line of business is concerned,” he boosted.
“As far as investment casting and aerospace machining concerned, we have established ourselves as a good player in this industry. And our skill sets are such that today world leaders in this technology and world leading customers look to us on their own seeking more and more products. So, we don’t see any execution challenges as such on any of the other lines of business,” he said.
Looking ahead, the company remains optimistic about demand across its key end markets. According to Balasubramanian, the aerospace industry is expanding at an average rate of around 40 per cent, while the gas turbine segment is expected to grow by nearly 50 per cent, driven by rising power demand from data centres.
The CFO also pointed to the company’s diversified product portfolio as a key strength. Indo-MIM currently manufactures around 6,400 components every month and adds 35-40 new components to its product library on an average each month.
“As far as MIM concerned, we have a robust library of about 6,400 components which we are executing month on month. And we are adding at an average of about 35 to 40 new components which is also mentioned in our prospectus. So, our growth trajectory continues to be strong and we feel that the growth will continue in days to come, too,” he concluded.
Strong debut for Indo-MIM
The company’s market valuation stood at Rs 35,132.87 crore.
The initial public offer of Indo-MIM Ltd got subscribed 72.34 times on the final day of bidding on Monday. The public issue was priced in the range of Rs 461-485 per share.
The company plans to utilise Rs 400 crore from the fresh issue proceeds towards pre-payment or repayment of certain outstanding borrowings, while the remaining amount will be used for general corporate purposes.
Incorporated in 1996, Indo-MIM manufactures precision engineering components using Metal Injection Molding (MIM) technology and provides end-to-end manufacturing solutions.
