Ganga Forging is in the business of manufacturing closed die forged products that cater to both automotive and non-automotive segments. Simply put, they produce parts for vehicles and other manufacturing equipment that have moving parts in them i.e. crankshafts, hubs and flanges.
The company has been in operation for over 30 years now and its main customers include the likes of Amul Industries and Nashik Forge. The company tends to both domestic and foreign clients but its export income is largely insignificant. However, they have grand plans to expand into other countries but because of their current financial standing they have had to delay these plans.
|Description of Cost||Project Cost (in lakhs)|
|Plant & Machinery||683.99|
|Misc. Fixed Assets||41.95|
|Margin for Working Capital||26.82|
|Particulars||Amount (in lakhs)|
|Out of Issue Proceeds||460.12|
|Total Means of Finance||870.12|
So will the new facility help the company to improve its financials. Well, let’s look at the financials first.
So if you were looking for the financial statements to give the company a vote of confidence. We don’t think you’ll find it. Currently, the company is run by Mr. Hiralal Tilva and Mr. Rakesh Chaganlal Patel, both experienced veterans. Maybe that’s comforting? We don’t know. But the company is currently planning to raise about 5 crores mostly to meet its expenses in funding the new manufacturing facility.
The company is listing 23,82,000 equity shares of Rs. 10 each at a fixed price of Rs. 21 per share. If we annualize latest earnings, on a post issue basis the asking price is at a P/E of around 32.