About the Company

• Jyoti CNC Automation is a name synonymous with precision and innovation in the world of metal cutting. Established in 1991, the company has grown to become a leading manufacturer of Computer Numerical Control (CNC) machines in India, holding the second-largest market share domestically and ranking 12th globally.
• Since its inception, the company has grown manifold from manufacturing gear boxes for machines to developing precision all-geared head lathe machines. Later on, Jyoti has identified a shift from conventional machines to highly sophisticated CNC machines.
• The company competes at a global level and supplies CNC machines to Romania, France, Poland, Belgium, Italy, and the United Kingdom through Huron’s established dealer network and also has 29 sales and service centres.
• The company has plants located at GIDC, Metoda, RAJKOT – Gujarat, having a large capacity of manufacturing the machines equipped with a foundry, sheet metal shop, paint shop, sub-assembly and assembly lines, and a repair facility.
• ISRO and Tata Advanced System are also among its noted vendors.
• The Jyoti CNC Automation IPO is a good opportunity for investors to participate in the growth of the Indian aerospace market. The IPO is open for subscription from January 9 to 11, 2024.

Company Website: https://https://jyoti.co.in/

Primary Business of the company:

Jyoti CNC Automation occupies a prominent position in the global metal cutting CNC machine landscape. In India, the company stands tall as the third-largest player, capturing roughly 10% of the market share in the fiscal year 2023 (source: F&S Report). On a global level, Jyoti CNC ranks thirteenth, commanding a share of 0.4% in the calendar year 2022 (source: F&S Report). Within India, the company further cements its leadership by being the foremost manufacturer of simultaneous 5-Axis CNC machines. Jyoti CNC boasts a diverse portfolio of CNC machines, catering to various needs with offerings like turning centers, turn-mill centers, vertical and horizontal machining centers.

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The products & services offered by the company:

Jyoti CNC Automation products and services include:

• CNC Turning / Turn Mill Centers
• CNC Vertical Machining Centers
• CNC Horizontal Machining Centers
• CNC 5 Axis Machining Centers
• CNC Multi Tasking Machines

The objective of Jyoti CNC Automation IPO:

The objective of the Jyoti CNC Automation IPO, as per the RHP, is to raise ₹1000 crores through a fresh issue of equity shares and an offer for the sale of existing equity shares.

The proceeds from the IPO will be used for the following purposes:

• Repayment of borrowing
• Funding long-term working capital requirements of the Company
• General corporate purposes

The IPO of Jyoti CNC Automation is being offered at a price band of Rs. 315-331 per share. The issue opens on January 9, 2024, and closes on January 11, 2024. The company is targeting to raise Rs. 1,000 crore through the IPO.

Key risks

The key risks associated with the Jyoti CNC Automation IPO include:

1. Losses in past: Company has incurred losses and consequently, had a negative return on equity in the past.

2. Not long term contracts: By their very nature, though, CNC machines are not consumer products and, therefore, we do not, generally, have repeat customers on an annual
basis

3. High debt: Comany has high debt currently and if they do not generate sufficient amount of cash flows from operations, our liquidity and our ability to service our indebtedness could be adversely affected.

4. The company has delayed in the payment of statutory dues in the past.

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Jyoti CNC Automation Past Financials

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Jyoti CNC Automation Restated Consolidated Statement of Assets and Liabilities (in ₹ million)

Particulars	As at September 30, 2023	March 31, 2023	March 31, 2022	March 31, 2021
ASSETS
Non-current assets
– Property, Plant and Equipment	2,829.37	2,689.02	2,745.55	2,991.55
– Capital work-in-progress	150.30	82.79	8.97	510.89
– Right of Use Assets	0.06	0.06	0.36	0.86
– Intangible assets	130.30	141.60	179.12	219.75
– Intangible assets under development	83.61	71.01	45.81	26.37
– Financial assets: – Investments	34.76	33.88	19.58	18.55
– Financial assets: – Other financial assets	17.89	100.47	49.76	118.92
– Other non-current assets	263.26	240.78	243.89	107.76
Total non-current assets	3,509.55	3,359.61	3,293.04	3,994.65
Current assets
– Inventories	8,683.49	8,199.19	6,340.41	6,447.06
– Financial assets: – Trade receivables	1,331.23	1,458.78	2,001.90	2,166.40
– Financial assets: – Cash and equivalents	86.05	160.92	24.44	101.15
– Financial assets: – Other balances with bank	209.19	121.97	201.21	123.47
– Financial assets: – Loans	31.17	59.30	48.51	47.22
– Financial assets: – Other financial asset	2,539.20	1,410.72	331.40	513.31
– Other current assets	628.45	336.38	587.25	488.66
– Current tax asset (net of provision)	42.32	46.94	34.20	–
Total current assets	13,551.10	11,794.20	9,569.31	9,887.27
TOTAL ASSETS	17,060.65	15,153.81	12,862.35	13,881.92
EQUITY AND LIABILITIES
Equity
– Equity share capital	391.51	329.29	294.79	294.79
– Compulsory convertible preference shares entirely in Equity Nature	3.93	–	–	–
– Other equity	2,133.29	491.35	116.74	831.07
Total equity	2,528.73	820.63	411.54	1,125.86
Non-current liabilities
– Financial liabilities: – Borrowings	1,042.91	1,274.65	1,402.63	1,194.28
– Provisions	130.32	127.78	121.67	233.02
– Deferred tax liabilities (net)	202.37	202.11	207.80	207.16
Total non-current liabilities	1,375.60	1,604.54	1,732.10	1,634.46
Current liabilities
– Financial liabilities: – Borrowings	7,171.13	7,075.09	6,518.94	6,056.89
– Trade payables – Micro & Small enterprises	21.46	17.90	7.28	12.13
– Trade payables – Other than Micro & Small enterprises	3,570.42	4,112.01	2,946.33	3,107.08
– Other financial liabilities	480.33	397.58	308.80	629.01
– Other current liabilities	1,695.70	978.32	857.35	1,299.68
– Provisions	17.83	17.40	18.14	16.81
– Current Tax Liabilities	199.45	130.34	61.87	–
Total current liabilities	13,156.32	12,728.64	10,718.71	11,121.60
TOTAL EQUITY AND LIABILITIES	17,060.65	15,153.81	12,862.35	13,881.92

Jyoti CNC Automation Restated Consolidated Statement of Profit and Loss (in ₹ million)

Particulars	6-Month Period Ended Sep 30, 2023	12-Month Period Ended Mar 31, 2023	12-Month Period Ended Mar 31, 2022	12-Month Period Ended Mar 31, 2021
Revenue
– Revenue from operations	5,098.22	9,292.59	7,464.87	5,800.59
– Other Income	7.07	233.41	35.74	100.33
TOTAL INCOME	5,105.29	9,526.00	7,500.61	5,900.92
Expenses
– Cost of materials consumed	952.87	6,795.30	4,187.80	4,638.57
– Changes in inventories of finished goods and work-in-progress	1,756.97	(1,469.17)	9.05	(1,449.02)
– Employee benefits expense	903.26	1,662.40	1,418.36	1,313.86
– Finance costs	491.85	897.02	821.99	755.12
– Depreciation and amortization expense	156.01	336.18	357.86	377.84
– Other expenses	741.11	1,330.28	1,123.04	980.28
TOTAL EXPENSES	5,002.07	9,552.01	7,918.11	6,616.65
Profit before tax and exceptional items	103.22	278.50	(417.50)	(715.73)
Exceptional Items
– Profit on Waiver of Loan	–	304.50	–	–
PROFIT BEFORE TAX	103.22	278.50	(417.50)	(715.73)
Current tax	70.00	135.80	65.00	–
Prior Period/Year Tax	–	0.50	–	–
Deferred tax	(0.30)	(8.40)	0.50	(15.44)
PROFIT FOR THE PERIOD / YEAR	33.52	150.60	(483.00)	(700.29)
Other Comprehensive Income
– Foreign Currency Translation Reserve	–	-78.10	-45.39
– Remeasurement gains/(losses) on post-employment defined benefit plans	2.23	10.90	(0.49)	(3.01)
– Income tax relating to items that will not be reclassified to profit or loss	(0.56)	(2.70)	0.09	0.76
Total Other Comprehensive Income/(loss)	1.67	8.20	(78.50)	(47.64)
Total Comprehensive Income for the Period / Year	35.19	158.80	(561.50)	(747.93)
Earnings per share (of ₹ 2)
– Basic	0.19**	1.02	(3.28)	(4.75)
– Diluted	0.19**	1.02	(3.28)	(4.75)

FAQs

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