Lohia Corp
IPO Size: Rs. 1,102 cr, Entirely Offer for Sale (OFS)
- 83% of OFS by promoter (96% to shrink to 75%)
- 17% of OFS by 3 individual investors (nearly completely exiting 4% holding)
Price band: Rs. 404-425 per share
M cap: Rs. 4,490 cr, implying 25% dilution
- Only 10% retail and 75% for institutions, as company was restructured in FY24 technically having no operating profit
IPO Date: Thu 23rd Jul to Mon 27th Jul 2026, Listing Thu 30th Jul 2026
Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.
Kanpur-based Machine Maker
Lohia Corp Limited, formerly known as Kanpur Packaging Machines Limited, manufactures machinery for bulk packaging such as polypropylene (pp), high-density polyethylene (HDPE), woven fabric and sacks (raffia) bags for fertilizer, sugar cement etc. Products comprise circular looms (33% of revenue), tape extrusion lines (20%), tape winders (10%), spare parts (10%) manufactured at 6 plants - 4 in India (2 each in Kanpur and Bengaluru), 1 in US and 1 in Italy. The Bengaluru, US and Italy facilities were onboarded inorganically. It is a market leader in woven raffia machines market with 15% global and 41% domestic market share.
Declining Volumes
From FY23 to FY26, production volume declined between 22% to 37% across the 3 major product categories – circular looms, tape winders, tape extrusion line. Even revenue dropped 7% in past 3 years, from Rs. 1,847 cr in FY23 (based on pre-demerger carved out financials) to Rs. 1,717 cr in FY26. This is a cause of concern as capacity is less than 50% utilized.
Margins on a Rise
Despite production volume and revenue declining, EBITDA margins have more than doubled from 8.6% in FY23 to 18.3% in FY26 in run-up to the IPO, even as gross margin rose from 36% in FY23 to nearly 44% in FY26. As this is surprising, performance needs to be monitored post-listing, to establish sustainability.
FY26 PAT stood at Rs. 193 cr, leading to 11% net margin and an EPS of Rs. 18.3. Company is net debt free on net worth of Rs. 522 cr, with no need for fresh funding.
Fully Priced IPO
M cap of Rs. 4,490 cr and enterprise value of Rs. 4,443 cr leads to a PE multiple of 23x on historic basis. This is in-line with small-size peers ruling between 21x (Rajoo Engineers) to 24x (Mamata Machinery) clocking similar margin. Hence no need to assign ‘capital goods’ valuation multiple.
While Lohia Corp’s revenue is generated equally from domestic and exports with order book also strengthening 64% YoY to Rs. 1,359 cr as of 31.3.26, margin sustainability and growth visibility is not yet established. Best is to track the performance, especially production volume, for a few quarters post-listing.
23rd Jul 2026 at 08:59 am