IPO listed on 17 Feb'25
Ajax Engineering Ltd
Minimum Investment
₹ 14,467 / 23 shares
Grey market premium
₹ -3 (-0.5% premium)
Issue price
₹ 629
Listing price
₹ 576
Listing gains
-53 (-8%)
Listing on
2025-02-17
Our Verdict:
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- Ajax Engineering Ltd (Ajax) dominates the Self-Loading Concrete Mixer (SLCM) segment with a 77% market share in India and benefits from an extensive dealership network.
- The firm has demonstrated impressive financial growth, supported by robust return metrics and industry-leading profitability margins.
- The IPO is fairly priced at a P/E ratio of 32x based on FY24 earnings. Given its market leadership, reasonable valuations, and solid financials, investors may consider subscribing to the IPO from a medium-to-long term perspective.
- Investors should note that the entire IPO issue is a liquidity event (offer for sale) for existing shareholders, with no proceeds going to the company. Additionally, a slowdown in FY25 infrastructure spending and a shift in government focus from capex to consumption (as per Budget 2025-26) make the sector outlook cautious. Therefore, substantial listing gains should not be expected.
About the company
Founded in
3 Jul'92
Managing director
Shubhabrata Saha
- Ajax is a leading concrete equipment manufacturer offering a comprehensive range of solutions across the concrete application value chain. As of September 30, 2024, it has developed 141+ equipment variants and sold 29,800+ units in India over the past decade.
- Its diverse product portfolio includes SLCMs, batching plants, transit mixers, boom pumps, concrete pumps, slip-form pavers, and 3D concrete printers, catering to production, transportation, placement, and paving of concrete. Its equipment is widely used in transportation, irrigation, and infrastructure projects, including airports, power plants, factories, and oil & gas terminals.
STRENGTHS
- Market Leadership: Ajax dominates the fast-growing SLCM market in India, holding approximately 77% market share in terms of units sold during the six months ending September 30, 2024. It products are sold under the ‘Argo’ brand.
- Comprehensive Product Portfolio: A leading concrete equipment provider, Ajax offers 141+ equipment variants, along with end-to-end solutions and services across the concrete application value chain.
- Diversified Customer Base: With a strong industry presence and long-standing relationships, Ajax serves 19,000+ customers as of September 30, 2024.
- Robust Financial Growth: Ajax has delivered exceptional financial performance, achieving a CAGR of 51% in operational revenue, 75% in EBITDA, and 84% in net profit from FY22 to FY24.
- Expanding Profit Margins: Profitability has strengthened steadily, with EBITDA margins rising from 11.85% in FY22 to 15.82% in FY24, and net profit margins improving from 8.58% to 12.65%, outperforming listed peers.
- Solid Return Metrics: Ajax demonstrates impressive efficiency, with Return on Equity (RoE) at 24.53% and Return on Capital Employed (RoCE) at 32.82% as of FY24.
RISK FACTORS
- Revenue Concentration: Ajax relies heavily on SLCMs, which accounted for 85% of FY24 revenue. A decline in SLCM sales or overall demand for concrete equipment in India could significantly impact business performance.
- Unresolved Lease Issues: The leases for two key assembling and manufacturing facilities have expired. While Ajax has applied for ownership, there is no guarantee of approval, posing potential risks to operations and financial stability.
- Cash Flow Concerns: Ajax reported negative cash flow from operations and financing activities for the six months ending September 30, 2025. Persistent negative cash flows may impact business continuity and financial health.
Financials
All Values are in Cr.
Issue details
Issue type
Mainstream
Issue size
₹ 1,269.35 crore
Fresh Issue
₹ -
OFS
₹ 1,269.35 crore
Price range
₹ 599 - 629
Lot size
23 shares
Issue Objective
This issue is a pure Offer for Sale (OFS), which means the company will not receive any proceeds from the issue. All funds raised will go directly to the selling shareholders.
Dates
Bidding open
10 Feb'25
Bidding close
12 Feb'25
Allotment date
13 Feb'25
Refund date
14 Feb'25
Listing
17 Feb'25
IPO Reservations
Qualified institutional buyers
<50%
Non-institutional investors
>15%
Retail individual investors
>35%
Read the Offer Document
© 2025 by Liquide Solutions Private Limited, SEBI Registered Research Analyst (Registration number - INH000009816)
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