Bain Capital-backed auto components manufacturer Dhoot Transmission has received approval from the Securities and Exchange Board of India (SEBI) for its proposed initial public offering (IPO).
Founded about 20 years ago by promoter Rahul Dhoot, Dhoot Transmission is a supplier to original equipment manufacturers (OEMs) across the automotive and consumer durables sectors.
Equity firm Bain Capital holds a 49% stake in the company. Bain’s investment was accompanied by the consolidation of promoter-held entities, including Dhoot Holding, into Dhoot Transmission.
Dhoot Transmission business
The company manufactures wiring harnesses, automotive switches, electronic sensors and controllers, connectors and terminals, automotive cables, power cords and battery packs.
Its products cater to a wide range of applications, including two-wheelers, three-wheelers, passenger and commercial vehicles, off-road vehicles, earth movers, agricultural equipment, medical equipment and domestic appliances.
Its marquee clients include Bajaj Auto, TVS Motor Company, Honda Motorcycle & Scooter India and Royal Enfield. As for its global operations, Dhoot Transmission established an engineering and marketing office in the UK in 2012, acquired TFC Cables in Scotland, with a manufacturing facility in Slovakia, in 2017, followed by the acquisitions of Parkinson Harness in the UK in 2018 and San Electromec in 2019.
The company operates an integrated manufacturing and technology platform, with all its facilities and offices connected through SAP S/4HANA. It employs over 12,000 people.
Dhoot Transmission financials
Dhoot Transmission’s consolidated revenue scaled up to Rs 2,653 crore in FY24 from Rs 1,550 crore in FY22. The company derives 15–20% of its revenue from overseas operations, which, along with geographic diversification, supports its business risk profile.
The company has gross current assets of around 104 days as of March 31, 2024, including receivables of 56 days and inventory of 39 days. Furthermore, the company has a comfortable risk profile, with net worth improving to Rs 598 crore as of March 31, 2024, up from Rs 387 crore a year earlier, and gearing at 0.59 times. Its debt protection metrics strengthened in FY24, with interest coverage rising to 9.3 times.