Mamata Machinery IPO: Price band, offer size, business model and other key details to know before December 19 launch

Mamata Machinery on Friday announced that its mainboard initial public offering (IPO) will open for subscription next week on December 19.

Price band for the Mamata Machinery IPO has been fixed at ₹230 to ₹243 per share. The minimum bidding quantity to apply for the issue is 61 shares, for retail investors.

The mainboard IPO is entirely an offer-for-sale (OFS) of 74 lakh shares. The company aims to raise ₹179.39 crore via its initial public offering.

The IPO will close for subscription on December 23 and the stock is likely to be listed on both the BSE and the National Stock Exchange of India (NSE) on December 27.

If you are planning to invest in the Mamata Machinery IPO, here is a detailed look at the company’s business and financials.

Business profile

Mamata Machinery was incorporated as Patel Machinery Pvt. Ltd in 1989. Headquartered in Ahmedabad, Gujarat, it is a leading manufacturer of advanced bag and pouch making machinery, including plastic bag machines, sachet packing machines, and zip lock pouch making machines.

The company sells machines under the brand name “Vega” and “Win”. As of September 30, 2024, it had installed over 4,500 machines in 75 countries. The company serves more than 2,500 customers across more than 90 countries.

It operates from a state-of-the-art facility in Ahmedabad, spanning 450,000 sqft. In the United States, Mamata Machinery has facilities at two strategic locations at Montgomery (Illinois) and Bradenton (Florida).

Strengths

Weaknesses

Competitors

The company faces significant competitive pressures in the packaging industry. In fiscal 2024, it emerged as the seventh largest exporter of packaging machines from India and contributed 3% of market share of total export of packaging machineries.

In the Indian landscape, small to mid-sized as well as larger companies are all involved in domestic as well as international markets, expanding their global presence. Further, the involvement of MNCs significantly influences the packaging industry, bringing in advanced technological expertise and adhering to international standards.

In India, Mamata Machinery competes mainly with UFlex Limited, Smart Pack India, Nichrome India Ltd, XL Plastics, Galaxy PackTech Pvt. Ltd and Harikrushna Machines Pvt. Ltd.

Financials

The company has a healthy track record of revenue growth and profitability. Its revenue from operations showed a compounded annual growth rate (CAGR) of 10.94% from FY 2021-22 to FY 2023-24, while its operating profit (earnings before interest, tax, depreciation and amortisation) posted a CAGR of 25.5% during the same period.