What You Must Know About Aesthetik Engineers IPO: Price Band ₹55 to ₹58 Per Share

About Aesthetik Engineers Limited

Aesthetik Engineers Limited, incorporated on April 02, 2008, as a Private Limited Company under the Companies Act of 1956, has a rich history in engineering and construction. Initially named "Aesthetik Engineers Private Limited," the company evolved from the takeover of an existing partnership firm, "M/s Aesthetik." A significant milestone was reached on January 24, 2024, when the company converted to a Public Limited Company, changing its name to "Aesthetik Engineers Limited" following a special resolution passed by members at an Extra-Ordinary General Meeting on December 18, 2023.

Aesthetik Engineers Limited's specialisation in the design, engineering, fabrication, and installation of facade systems is underscored by its diverse portfolio. This encompasses building facades, Aluminium Doors and Windows, Railing and Staircase, and Glassfibre Reinforced Concrete (GRC). The company caters to a wide range of industries, including Hospitality, Architecture, and Infrastructure, offering end-to-end solutions from facade design to on-site installation.

The company's manufacturing facility, strategically located in Howrah, Kolkata, serves as the hub for the fabrication and assembly of its products. This location is chosen with a strong emphasis on quality and performance, ensuring that Aesthetik Engineers' products are engineered to withstand various environmental factors such as UV rays, rain, dust, and noise, ensuring durability and customer satisfaction.

The Objective of the Issue

Aesthetik Engineers Limited aims to utilise the net proceeds from the IPO for the following purposes:

• To meet the Capital Expenditure Requirements of the Company
• To fulfil the Working Capital needs of the Company
• To address General Corporate Purposes
• To cover the Issue Expenses

Highlights of the Aesthetik Engineers IPO

Aesthetik Engineers Limited is set to launch its Initial Public Offering (IPO) with a book-built issue of ₹26.47 crores. The issue comprises a fresh issue of 45.64 lakh shares with no offer-for-sale component. Here are the key details of the IPO:

• Aesthetik Engineers IPO opens for subscription on 8th August, 2024, and closes on 12th August 2024.
• Allotment is expected to be finalised on Tuesday, 13th August 2024.
• The company will list on NSE SME, with a tentative listing date of Friday, 16th August 2024.
• The price band is set at ₹55 to ₹58 per share.
• The minimum lot size for the application is 2000 shares.
• Retail investors need to invest a minimum of ₹116,000.
• For High Net Worth Individuals (HNIs), the minimum investment is 2 lots (4,000 shares), amounting to ₹232,000.

Narnolia Financial Services Ltd is the book-running lead manager for the IPO, while Skyline Financial Services Private Ltd serves as the registrar. Nikunj Stock Brokers has been appointed as the market maker for the issue.

Aesthetik Engineers IPO: Key Dates

The Aesthetik Engineers IPO opens on Thursday, 8th August 2024, and closes on Monday, 12th August 2024. The bid dates are from 8th August 2024, at 10:00 AM to 12th August 2024, at 5:00 PM. The cut-off time for UPI mandate confirmation is 5 PM on the issue closing day, 12th August 2024.

Aesthetik Engineers IPO Issue Details/Capital History

The Aesthetik Engineers IPO is set to raise ₹26.47 crore through an Initial Public Offering (IPO). The issue comprises 4,564,000 equity shares with a face value of ₹10 each, priced between ₹55 and ₹58 per share. The Aesthetik Engineers IPO will open for subscription on 8th August 2024 and close on 12th August 2024. Investors can apply for a minimum of 2000 shares.

The company’s shares will be listed on the NSE SME post-issue. Narnolia Financial Services Ltd is the book-running lead manager, while Skyline Financial Services Private Ltd is the registrar.

IPO Allocation and Lot Sizes

The IPO shares are allocated across different investor categories as follows:

Investors can bid for a minimum of 2000 shares and in multiples thereof. The table below shows the minimum and maximum investment by retail investors and High Net Worth Individuals (HNI) in terms of shares and amount.

SWOT Analysis: Aesthetik Engineers IPO

Strengths:

• Core Skills and Abilities: Aesthetik Engineers excel in planning and manufacturing building facades, doors, windows, railings, and concrete products. Their use of advanced Italian machinery enhances efficiency and cost-effectiveness.
• Financial Performance: The company maintains strong profitability through effective cost management in production. Long-term agreements with key customers ensure a steady income stream.
• Brand Reputation and Customer Loyalty: Aesthetik Engineers has built a strong reputation for quality work and timely project completion. Successful projects for notable clients like Coal India Limited have fostered trust and customer loyalty.
• Strong Management Team: Led by Mr. Avinash Agarwal, who brings over 20 years of industry experience, the company benefits from seasoned leadership crucial for growth.
• Technological Expertise: Using advanced Italian technology gives Aesthetik Engineers a competitive edge in efficiency and quality.
• Intellectual Property: The company's unique processes and quality standards protect its intellectual property, maintaining its market leadership.

Weaknesses:

• Financial Constraints: Limited financial resources may hinder expansion plans or investments in new technologies.
• Lack of Skilled Workforce: The challenge of recruiting and retaining skilled workers could impact efficiency and growth potential.
• Dependency on Key Customers or Suppliers: A high reliance on a few key customers or suppliers poses a risk if these relationships are disrupted.
• Outdated Technology: Delays in upgrading technology could lead to a competitive disadvantage.
• Inefficient Processes: Any weaknesses in internal processes may result in financial issues and operational inefficiencies.

Opportunities:

• Expanding Market Segments: Renewable energy, construction, and infrastructure growth potential exists.
• New Product or Service Development: Introducing innovative products and services could attract new customers and enhance competitiveness.
• Strategic Partnerships: Forming strategic alliances could open new business avenues and facilitate market expansion.
• Government Initiatives: Programs supporting renewable energy and infrastructure development present growth opportunities.
• Technological Advancements: Investing in cutting-edge technology can improve efficiency, reduce costs, and enhance product quality.

Threats:

• Intense Market Competition: Operating in a highly competitive market with organized and unorganised players poses market share and profitability challenges.
• Low Entry Barriers: The absence of significant entry barriers in the industry increases the threat of new competitors.
• Evolving Consumer Preferences: Rapidly changing customer demands and preferences require constant adaptation.
• Economic Fluctuations: Economic downturns could impact the construction and infrastructure sectors, affecting demand for Aesthetik Engineers' products and services.
• Regulatory Changes: Alterations in government policies or regulations could affect the company's operations and profitability.

Financial Highlights: Aesthetik Engineers Limited

The table below presents the key financials of Unicommerce Aesthetik Engineers IPO for recent periods:

Aesthetik Engineers has demonstrated robust financial growth over the past two fiscal years. The company's revenue increased significantly from ₹4,035.82 lakhs in Fiscal 2023 to ₹6,079.50 lakhs in Fiscal 2024, representing a growth of approximately 50.6%. This substantial increase in revenue reflects the company's expanding market presence and successful project execution.

The Profit After Tax (PAT) has shown remarkable improvement, rising from ₹112.59 lakhs in Fiscal 2023 to ₹502.99 lakhs in Fiscal 2024, a staggering increase of about 346.7%. This significant jump in profitability indicates the company's ability to manage costs while scaling up operations efficiently.

The company's total assets have grown from ₹2,457.77 lakhs in Fiscal 2023 to ₹3,088.94 lakhs in Fiscal 2024, an increase of approximately 25.7%. This asset growth reflects the company's ongoing investments in technology, infrastructure, and market expansion strategies.

Aesthetik Engineers' net worth has also substantially increased, rising from ₹999.42 lakhs in Fiscal 2023 to ₹1,502.41 lakhs in Fiscal 2024, a growth of about 50.3%. The rising net worth underscores the company's ability to retain earnings and strengthen its financial position yearly.

It's worth noting that the company's total borrowings have increased from ₹592.47 lakhs in Fiscal 2023 to ₹849.92 lakhs in Fiscal 2024, an increase of approximately 43.5%. While this increase in borrowings indicates the company's efforts to fuel growth, monitoring the debt levels is important to ensure they remain manageable.

Aesthetik Engineers Limited has shown strong financial growth, with big increases in revenue and profit. Their higher net worth and assets make them look good to investors. However, investors should note the rise in borrowings and see how this debt is being used for growth. It will be important to watch how the company handles its debt and keeps making profits as it grows.