Allied Engineering Works has filed its Draft Red Herring Prospectus (DRHP) with SEBI. The company is planning an IPO of ₹400 crore. Allied Engineering holds a stake of over 10% in the smart meter segment, making it a prominent player in this field.
Allied Engineering Works, a company active in the manufacturing and supply of smart energy meters, has initiated the official process of launching its Initial Public Offering (IPO). The company has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). This IPO by Allied will comprise a fresh issue of shares totaling ₹400 crore, along with an offer for sale of 75 lakh equity shares by the promoters.
Allied is now a giant in the smart meter segment
Allied Engineering Works has become a prominent name in the smart energy meter industry. The company's market share in the country's smart meter market is more than 10 percent. The company has supplied approximately 29.2 lakh smart meters across various states in the country so far. Allied's smart meters have been supplied to 13 different AMISPs (Advanced Metering Infrastructure Service Providers) and one state utility. This includes major states like Andhra Pradesh, Gujarat, Maharashtra, Haryana, Punjab, and Uttar Pradesh.
Utilization of Funds from the IPO
The company plans to utilize the funds raised from the IPO to enhance its manufacturing capabilities, meet working capital needs, and for other corporate purposes.
₹116.75 crore will be spent on establishing smart gas meters, water meters, and IoT-based solutions at the Kundli plant.
₹99.71 crore will be invested in increasing the capacity of smart electricity meters at the Rai plant.
₹120 crore will be reserved for working capital requirements.
The remaining amount will be used for general corporate activities.
₹80 crore can also be raised through pre-IPO placement
Allied Engineering is also considering a pre-IPO placement of up to ₹80 crore. If this funding is raised beforehand, the size of the fresh issue in the IPO will be reduced accordingly.
Genus Power, HPL, and other companies may face tough competition
Companies already present in the smart meter space such as Genus Power Infrastructures, HPL Electric and Power, Secure Meters, Avon Meters, and Capital Power Systems may face direct competition from Allied's entry. According to market analysts, Allied's aggressive strategy and manufacturing capacity could make it a major player in this competitive sector.
Rapidly growing smart meter market
The smart metering segment in India is currently booming. The government's smart meter scheme, DISCOM reforms, and digital transformation are leading to a surge in demand in this sector. Companies like Allied are fully prepared to take advantage of this emerging opportunity.
Who are the managers of the IPO?
Axis Capital and IIFL Capital Services are managing this issue. Allied's equity shares are proposed to be listed on both BSE and NSE.
Company's history and expansion
Allied Engineering Works has made rapid strides in smart metering technology. The company has upgraded its production processes and products in accordance with current market demand. Allied's focus is specifically on manufacturing electricity, water, and gas meters. The company is constantly investing in technological innovation to deliver modern IoT solutions.
Accelerating steps, growing share
According to a CRISIL report, Allied's current contribution accounts for approximately one-tenth of the total smart meters installed in India. This figure firmly establishes the company's position in the industry. In the future, the company can further expand its presence and production capacity to more states and international markets.
The IPO will provide new momentum
This IPO by Allied Engineering Works will not only accelerate the company's expansion and plans but is also seen as a new opportunity for investors in the Indian smart metering industry. In the current scenario, where the demand for smart energy solutions is rapidly increasing, this offering by Allied could change the direction of the market.
