Diffusion Engineers Limited IPO

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They specialize in the manufacturing of welding consumables, wear plates, wear parts, and heavy engineering machinery for core industries such as cement, steel, power, mining, oil & gas, and sugar. With over four decades of experience, they also provide repair and reconditioning services for heavy machinery and equipment, ensuring extended life and reduced production costs for the clients.

Their offerings include:
i. Welding consumables like special-purpose electrodes and flux-cored wires.
ii. Wear plates, which are used in industrial equipment to protect machinery from wear and tear.
iii. Heavy engineering machinery that integrates wear plates for enhanced durability.

Market Overview and Growth Projections

The welding consumables market in India was valued at around ₹51 billion in fiscal 2024 and is projected to grow to ₹64-66 billion by fiscal 2027. This growth is driven by increasing infrastructure investments, including the construction of roads, bridges, ports, and airports.

The wear plates market is also growing, valued at approximately ₹22 billion in fiscal 2024, with an expected CAGR of 8-9% to reach ₹28 billion by fiscal 2027. Wear plates are essential in industries like power plants, steel mills, and cement manufacturing, where they protect critical machinery components from wear and tear.

India’s heavy engineering capital goods industry is valued at ₹3,100-3,200 billion in fiscal 2024, with a projected CAGR of 7.5-8.5% over the next few years, reaching ₹3,800-3,900 billion by fiscal 2027. The largest segments within this industry include heavy electrical engineering, earthmoving, construction and mining machinery, and process plant equipment.

By aligning their capabilities with these growing markets, they are well-positioned to meet the increasing demands of India’s industrial sector and continue expanding their presence in the heavy engineering and manufacturing space.

Objects of the Diffusion Engineers Limited IPO:

The Company proposes to utilize the Net Proceeds from the Issue towards funding the following objects: i. Funding capital expenditure requirements towards the expansion of existing manufacturing facility at Khasra No. 36, 38/1, 38/2, 38/3, Khapri (Uma), Nagpur- 441 501, Maharashtra, India (Proposed Expansion); ii. Setting up of a new manufacturing facility located at Plot Nos. 33-B/1/1/ & 33-B/1/1/Part, MIDC, Hingna, Sonegaon District, Nagpur-440 016, Maharashtra (Proposed Facility); iii. Funding working capital requirements of the Company; and iv. General Corporate Purposes.

Diffusion Engineers Limited IPO Details:

Open Date: Sep 26 2024
Close Date: Sep 30 2024
Total Shares: 9,405,000
Face Value: ₹ 10 Per Equity Share
Issue Size: 158.00 Cr.
Lot Size: 88 Shares
Issue Price: ₹ 159 - 168 Per Equity Share
Listing At: NSE,BSE
Listing Date: Oct 04 2024

Promoters And Management:

Prashant Garg, 41, is the Chairman and Managing Director of the company. He holds a bachelor's degree in engineering from Rashtrasant Tukadoji Maharaj Nagpur University and an MBA from Saïd Business School, University of Oxford. With 20 years of industry experience, he has been with the company since 2003. Prashant oversees daily operations, product development, technology upgrades, and innovations in the manufacturing process. He also serves as a director on the board of the overseas subsidiaries. Dr. Nitin Garg, 48, is the Non-Executive Director of the company. He holds a bachelor's degree in medicine and surgery from Nagpur University, a master's in general surgery from Manipal Academy, and a master's in neurosurgery from NIMHANS, along with a Fellowship from the University of Pittsburgh. He currently practices as a neurosurgeon in Bhopal and is the founder of BTSG Awareness Foundation and CENOS Health Care Private Limited. Chitra Garg, 71, has been serving as the Non-Executive Director of the company since December 2023. She holds a master's degree in arts (Geography) from Agra University. Previously, she was a board member of the company and continues to serve on the board of the subsidiary, Diffusion Super Conditioning Services Private Limited, since 1995.

Financials of Diffusion Engineers Limited IPO:

Particulars FY 2024 FY 2023 FY 2022
Revenue from Operations ₹278 ₹254 ₹204
Cost of Materials Consumed ₹129 ₹137 ₹116
Employee Benefit Expenses ₹36 ₹30 ₹26
Other Expenses ₹17 ₹15 ₹11
EBITDA ₹47 ₹34 ₹27
EBITDA Margin 17.04% 13.65% 13.45%
Net Profit (PAT) ₹30 ₹22 ₹17
Net Profit Margin (NPM) 10.79% 8.56% 8.16%

Recommendation on Diffusion Engineers Limited IPO:

Lead Manager of Diffusion Engineers Limited IPO:

  1. Unistone Capital Pvt Ltd

Registrar of Diffusion Engineers Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

Diffusion Engineers Limited T-5 & T-6, Nagpur Industrial Area, MIDC, Hingna, Nagpur - 440016 Phone: +91 9158317943 Email: cs@diffusionengineers.com Website: https://www.diffusionengineers.com/

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