3 mins read
09-September-2024
Tolins Tyres Limited, a well-established name in the Indian tyre manufacturing sector, is set to make its initial public offering (IPO). The Tolins Tyres IPO is expected to garner attention from retail and institutional investors alike, as the company aims to expand its market presence and financial footing through this public offering. This article simplifies the Tolins Tyres IPO for beginner-level investors, providing essential details and insights into what to expect.
Tolins Tyres Limited IPO details
The Tolins Tyres Limited IPO consists of a fresh issue of equity shares and an offer for sale. The fresh issue is expected to raise Rs. 2,000 million, while the offer for sale component will aggregate up to Rs. 300 million, bringing the total IPO size to Rs. 2,300 million. The shares have a face value of Rs. 5 each, and the offer follows a 100% book-built process.Offer structure
The Tolins Tyres IPO will include a combination of a fresh issue of equity shares and an offer for sale by the promoters, Dr. Kalamparambil Varkey Tolin and Jerin Tolin. The fresh issue will raise Rs. 2,000 million, while the offer for sale will consist of equity shares amounting to Rs. 300 million. Retail investors, Qualified Institutional Buyers (QIBs), and Non-Institutional Bidders (NIBs) will be allocated shares based on a proportionate system. Up to 50% of the offer is reserved for QIBs, 15% for NIBs, and 35% for retail investors.Why is Tolins Tyres going public?
Tolins Tyres Limited is going public to raise funds for its growth initiatives, particularly in expanding its manufacturing capacity and improving its distribution network. The company aims to strengthen its position in the domestic and export markets by using the proceeds from the fresh issue for working capital requirements and general corporate purposes.About Tolins Tyres Limited
- Founded: 2003, headquartered in Ernakulam, Kerala
- Market: Tolins Tyres operates both in the domestic market and has a growing presence in exports.
- Product range: The company manufactures a variety of tyres for commercial vehicles, passenger cars, and two-wheelers. In addition, they produce treads for retreading applications.
- Promoters: The company is promoted by Dr. Kalamparambil Varkey Tolin and Jerin Tolin.
Tolins Tyres' financial performance
| Metrics | FY 2024 (Consolidated) |
| Revenue (in Rs. Crore) | 228.69 |
| Net worth (in Rs. Crore) | 100.53 |
| Profit after tax (in Rs. Crore) | 26.01 |
| ROE (%) | 25.87% |
| ROCE (%) | 36.08% |
| Debt to Equity Ratio | 0.78 |
Strength and risks of Tolins Tyres
Tolins Tyres Limited, with its established market presence and product diversity, holds significant advantages. However, like any investment, it comes with certain risks.Strength of Tolins Tyres
- Strong brand presence in South India and growing international market share.
- Diversified product portfolio catering to various vehicle segments.
- Experienced promoters with in-depth industry knowledge.
- Consistent financial performance with healthy profit margins and returns.
Top risks to consider before applying for the Tolins Tyres IPO
- Competition from established players in the tyre manufacturing sector.
- Exposure to fluctuations in raw material prices.
- Reliance on the commercial vehicle segment, which is sensitive to economic cycles.
- Potential disruptions in the export market due to global economic factors.
