Sumax Engineering - Sumax Engineering is coming out with an initial public offering (IPO) of 52,87,200 shares in a price band of Rs 95 - 101 per equity share.
- The issue will open for subscription on August 25, 2026 and will close on August 28, 2026.
- The shares will be listed on SME Platform of NSE.
- The face value of the share is Rs 10 and is priced 9.50 times of its face value on the lower side and 10.10 times on the higher side.
- Book running lead manager to the issue is GYR Capital Advisors.
- Compliance officer for the issue is Prateek Nahata.
Profile of the company Sumax Engineering is engaged in both the manufacturing and trading of a diverse range of products tailored for the Automotive OEM (Original Equipment Manufacturer) Market and Auto Refinish Market. Its manufacturing division specializes in producing high-quality adhesive tapes and die-cuts, rubbing and polishing compounds, buffing pads, reflective tapes and printing solutions, domes and graphics, as well as an extensive range of car care products. These offerings are designed to meet industry standards and provide reliable solutions for automotive applications. In addition to manufacturing, its trading segment supplies a variety of essential products, including electrical and pneumatic tools, abrasive sheets, discs, and rolls, body shop consumables, retail products and accessories, and aerosol products. Through its all-inclusive portfolio, it aims to deliver innovative and high-performance solutions that cater to the evolving demands of both automotive manufacturers and the aftermarket industry. Further, it has ventured into a new product, namely Paint Protection Film (PPF), a transparent thermoplastic polyurethane film applied to the painted surfaces of vehicles. PPF is designed to protect the vehicle’s paint from stone chips, scratches, stains, minor abrasions and exposure to environmental elements, thereby helping maintain the vehicle’s exterior paint protection and surface finish. Its products adhere to both national and international quality standards and are widely used in the automotive industry and commercial applications. It offers customization options to meet the diverse requirements of its clients. Its manufacturing processes comply with ISO 9001:2015 and IATF 16949:2016 certifications, ensuring the highest quality, safety, and environmental standards. By utilizing premium-grade raw materials, it maintains consistency and reliability in its products. Each product undergoes a rigorous quality control and testing process before reaching the market, guaranteeing superior performance and compliance with industry standards. Proceed is being used for: - Funding of capital expenditure towards construction of proposed manufacturing unit I at Plot No-E-185, RIICO IND Area Karoli Teh Tapukara, Rajasthan.
- Funding of capital expenditure towards construction of proposed manufacturing unit II at Plot No. P 32 Street No. B, Sector 11, Model Economic Township, Village - Nimana, Tehsil Badli, District - Jhajjar, State Haryana.
- Funding working capital requirements of the company.
- General corporate purposes.
Industry overview India has become the fastest-growing economy in the world in recent years. This fast growth, coupled with rising incomes, a boost in infrastructure spending and increased manufacturing incentives, has accelerated the automobile industry. The two-wheeler segment, driven largely by the expanding middle class, continues to dominate the market, with sales reaching 19.6 million units in FY25. This surge in demand has also encouraged the expansion of original equipment and auto component manufacturers, helping India build strong expertise in this space and enhancing global demand for Indian vehicles and components. The industry is now witnessing a shift towards electrification, though internal combustion engine (ICE) vehicles continue to dominate. The auto component industry has become a vital segment of the economy, spanning large corporations to micro enterprises across manufacturing clusters nationwide. It accounted for 2.3% of India’s GDP in FY25 and provided direct employment to over 1.5 million people, a figure expected to rise as the sector’s GDP contribution reaches 5-7% by 2026. India’s auto-component industry is poised to reach $200 billion by 2030, supported by its cost competitiveness, skilled workforce, and growing domestic demand. The sector is projected to achieve exports worth Rs 8,54,700 crore ($100 billion) by 2030, underscoring its global competitiveness. In FY25, exports stood at Rs 1,95,726 crore ($22.9 billion). North America remained the largest export destination with a 32% share, recording 8.4% growth, while Europe, with a 29.5% share, registered a 2.1% decline. Asia accounted for 26% of exports and witnessed robust growth of 15.1%. The key export items included drive transmission and steering, engine components, body and chassis parts, suspension systems, and braking components. India's auto component exports are projected to reach $70-100 billion by FY30, driven by rising demand for electric vehicle (EV) technologies and global supply chain diversification. Indian SMEs could capture $20-30 billion of this opportunity by leveraging cost advantages and high-quality standards. India’s auto components industry has significantly expanded its market share, driven by rising automobile demand from the growing middle class and strong global exports. The sector has attracted both Indian and international players and is broadly classified into organised and unorganised segments. While the unorganised sector primarily caters to the aftermarket with low-value items, the organised sector focuses on supplying high-value precision instruments to Original Equipment Manufacturers (OEMs). India’s automobile production further highlights the scale of demand that supports the component industry. In FY26 (April-September), domestic sales stood at 1,02,36,639 units for two-wheelers, 20,51,082 units for passenger vehicles, 4,63,502 units for commercial vehicles, and 3,94,450 units for three-wheelers. In FY26 (April-September), the total production of Passenger Vehicles, Commercial Vehicles, Three Wheelers, Two Wheelers and Quadricycle was 1,65,34,997 units. In FY25, domestic OEM supplies accounted for about 54% of the industry’s turnover, followed by the domestic aftermarket at around 10% and exports at 19%. Supplies to OEMs stood at Rs 5,70,000 crore ($66.69 billion), reflecting a 10% YoY growth, while the aftermarket segment was valued at Rs 99,948 crore ($11.6 billion), recording a 6% increase over FY24. India's Automotive Mission Plan 2047 aims to boost vehicle production to 50 million by 2030 and 200 million by 2047, positioning India among the top two global auto producers. It prioritizes sustainable vehicle production with hydrogen, electric, CNG, and biogas, while not curbing petrol or diesel vehicles immediately. Pros and strengths Comprehensive product range: Its product portfolio has evolved in recent years as it has diversified into new categories of products to support its diverse base of customers. Its portfolio now encompasses a broad spectrum of industrial specialty adhesive tapes, it creates a range of tapes such as Automotive Masking Tape, PVC Fine Line Tape, Acrylic Foam Tape, Duct Tape, and more, designed to withstand tough conditions and help to streamline production. Rubbing and Polishing Compounds are vital for restoring a vehicle's finish. Rubbing Compounds remove deep scratches and imperfections, while Polishing Compounds smooth out fine marks, leaving a glossy, flawless surface. It also specializes in producing products to specific customer requirements and uses, such as rubbing and polishing compounds, car care products, polishing and buffing pads, reflective tapes, and printing domes and graphics. Through the provision of such a wide range of products, it is able to satisfy the diverse needs of various customer segments in sectors like automotive, where accuracy and quality are paramount. Strong industry relationships: Strong industry relationships are fundamental to the company’s success in supplying automotive OEMs, where the highest standards of quality, precision, and reliability are required. By consistently meeting these demands, it reinforces its reputation for excellence in the automotive sector. Its long-term partnerships with OEMs enhance its credibility and foster trust, enabling close collaboration to address evolving market needs and drive innovation. Its adaptability to emerging technologies, such as electric vehicle components and advanced manufacturing processes, further strengthens these relationships. These collaborations create opportunities for joint ventures, shared research and development, and alignment with OEMs on sustainability initiatives. As a result, it positions itself as a trusted partner, delivering customized solutions with precision and ensuring on-time delivery - critical for the seamless operation of OEM production lines. Advanced in-house processing facilities focused on cost competitiveness: Its production facilities are equipped with cutting-edge machinery and technology, meeting the highest standards required in the automotive OEM industry. It adheres to rigorous hygiene and safety protocols, ensuring that the integrity of its products is maintained throughout the entire manufacturing process. Its investment in advanced manufacturing capabilities allows it to streamline processes, minimize waste, and enhance resource utilization, driving down operational costs without compromising quality. Furthermore, its in-house teams play a key role in maintaining high efficiency and strict quality control, enabling it to rapidly implement design improvements and optimize manufacturing processes. This flexibility, coupled with its quality management systems, allows it to effectively manage costs while delivering custom solutions tailored to its clients' needs in the automotive sector. By maintaining strict control over product development, quality assurance, and manufacturing costs, it empowers itself to efficiently meet customer demands and maintain competitive advantage in the market. Risks and concerns Exposure to raw material price fluctuations: The prices of its primary raw materials, including those imported for the production of Adhesive Tapes, Polishing and Buffing Pads, Rubbing and Polishing Compounds have been volatile. It sources raw materials such as Jumbo Rolls, Solvents, Skins, Heat Film and Velcro for its manufacturing operations from a combination of domestic and foreign suppliers. The cost of raw material consumed represented 36.57%, 43.26% and 44.29% of its total revenues in Fiscal 2026, Fiscal 2025 and Fiscal 2024, respectively. Raw materials used in the manufacturing of Adhesive Tapes, Rubbing and Polishing Compounds, and Buffing Pads are global commodities, and their prices tend to be cyclical, fluctuating in response to global market conditions. Its raw materials are imported from China, Japan, Portugal, Taiwan, United States of America, Spain, Thailand, South Korea, Vietnam, Germany, Malaysia and Turkey. If the costs of these raw materials rise due to factors such as rise in input and commodity prices or shortages in supply, and it is not able to recover these costs through cost saving measures elsewhere or by increasing the prices of its products, its results of operations could be adversely affected. Duty changes (by the Indian government and exporting countries) can result in price fluctuations, and hence volatility in demand. In the event prices for these raw materials subsequently decline there can be no assurance that it will be able to price its products based on the material costs it actually incurred. High dependence on customers in the automotive industry: It relies heavily on customers in the automotive industry. In the fiscal years 2026, 2025 and 2024 sales of products and services to Automotive Industry suppliers accounted for 100% for each year respectively. A loss of business or a significant reduction in the volume of sales from customers in the automotive industry, if not adequately replaced with new customers or business opportunities, could have a substantial negative effect on its overall business operations, financial condition, and long-term profitability. This could lead to a decline in revenue, reduced market share, and challenges in maintaining a stable financial performance. Its dependence on customers in the automotive industry makes it vulnerable to fluctuations in their performance, both globally and within India. This industry is often directly impacted by changes in general economic conditions and various other factors. Any disruption that alters the way this industry operates could negatively affect some of its customers, particularly if they are unable to adapt to and address these changes effectively. Substantial portion of revenues derives from key customers: Its key customers operate primarily in the Automotive Industry two-wheeler, passenger vehicle. Its business relies heavily on a few key customers who contribute 55.59%, 46.43% and 43.92% of its total sales in Fiscal 2026, Fiscal 2025 and Fiscal 2024, respectively. Its key customers operate primarily in the four-wheeler and two-wheeler vehicle industries. Since it is dependent on certain key customers for a significant portion of its sales, the loss of any of such customers or experience a decrease in demand from them whether due to contract losses, delays in fulfilling existing orders, unsuccessful negotiations, disputes, loss of market share, or a downturn in their business-its operations could be significantly impacted. If not suitably replaced with another customer, such changes could negatively affect its business, financial health, and overall performance. Outlook Sumax Engineering is engaged in the manufacturing and trading of a comprehensive range of high-performance automotive solutions, including adhesives, polishing compounds, power tools, and body shop consumables, serving both the Automotive OEM and Auto Refinish markets. It offers tailored product designs, sizes, and providing unmatched flexibility to meet the evolving needs of its clients. This flexibility allows it to develop solutions that seamlessly match its clients' unique requirements, boost product appeal, and meet precise functional needs. On the concern side, the majority of its product sales and services is concentrated in the region of Tamil Nadu and Haryana. For the Fiscal 2026, Fiscal 2025 and Fiscal 2024 its revenue from sale of products and services in Tamil Nadu and Haryana accounted for a total of 48.79%, 47.97% and 48.48% of its revenue from operations, respectively. Any adverse developments affecting its sales in these regions could have an adverse impact on its business, financial condition, results of operations and cash flows. The company is coming out with a maiden IPO of 52,87,200 equity shares of face value of Rs 10 each. The issue has been offered in a price band of Rs 95-101 per equity share. The aggregate size of the offer is around Rs 50.23 crore to Rs 53.40 crore based on lower and upper price band respectively. On performance front, revenue from operations increased 1.07% from Rs 14,612.60 lakh in Fiscal 2025 to Rs 14,769.06 lakh in Fiscal 2026. Profit after tax increased 27.82% from Rs 998.16 lakh in Fiscal 2025 to Rs 1,275.86 lakh in Fiscal 2026. Meanwhile, it constantly endeavours to improve manufacturing process and will increase manufacturing activities to optimize the utilization of resources. It has invested significant resources and intends to further invest in its activities to develop customized systems and processes to ensure effective management control. It regularly analyses its existing policies for providing its products which enables it to identify the bottlenecks and correct the same. This helps it in improving efficiency and putting resources to optimal use. Going forward, setting up a new manufacturing plants/units is a strategic initiative to enhance production capabilities and address growing market demands. The facility will be outfitted with advanced machinery and cutting-edge technology to enhance production speed, reduce lead times, and improve overall product quality. By adopting lean manufacturing practices and incorporating automation, the plant will optimize efficiency while minimizing waste.
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