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All that you should know about the Company before applying for the IPO.

February 28, 2023     

The public issue of equity shares of DIVGI TORQTRANSFER SYSTEMS LIMITED will open for subscription on March 01, 2023 and closes on March 03, 2023. It is expected to list on the stock exchanges on March 14, 2023. What does the company do? Why is the company going public? Who are its key competitors? Its key strengths, and lot more. Here’s everything that you want to know about the company to analyse the IPO.

Company Profile

Incorporated in 1964, the company is amongst the very few automotive component entities in India who have the capability to develop and provide system level transfer case, torque coupler and Dual Clutch automatic Transmissions (“DCT”) solution. They are one of the leading players supplying transfer case systems to automotive OEMs in India and the largest supplier of transfer case systems to passenger vehicle manufacturers in India. The company also has the capability to develop and provide transmission systems for electric vehicles (“EVs”). They are in the process of designing and developing prototypes of transmission systems for EVs pursuant to receipt of a business award for this purpose. Company’s diverse capabilities enable them to service customers across segments in the automotive industry, including passenger vehicles, utility vehicles and commercial vehicles.

The company manufactures and supply a variety of products under 3 broad categories:

  • (i) Torque Transfer Systems (which includes FourWheel- Drive and All-Wheel-Drive products)
  • (ii) Synchronizer Systems for Manual Transmissions and DCT
  • (iii) Components for the above-mentioned product categories for torque transfer systems and synchronizer systems in manual transmission, DCT, and EVs.

They have also developed (i) transmission systems for EVs; (ii) DCT systems; and (iii) rear wheel drive manual transmissions.

They have entered into a Product Development Agreement and a Technology Transfer Agreement with a German automotive company. Pursuant to these agreements, the Company is co-developing critical components and systems for DCT applications with exclusive rights for India and non-exclusive rights for markets outside India.

The company has 3 manufacturing and assembling facilities across India located at Sirsi in Karnataka, and Shivare and Bhosari near Pune in Maharashtra. Their key customers include marquee domestic and global OEMs in the automobile sector, such as BorgWarner, Tata Motors and Mahindra & Mahindra, amongst others.

Who are the Promoters of the Company?

Jitendra Bhaskar Divgi, Hirendra Bhaskar Divgi and Divgi Holdings Private Limited

Positives about the Company

  • One of the very few suppliers in India having the capability to develop and provide system level transfer case, torquecoupler, DCT solutions and transmission systems for EVs across a wide array of automotive vehicles and geographies,with leadership across select product categories
  • Strategically located manufacturing facilities capable of producing high precision components meeting system-level design intent
  • Long-term relationships with marquee domestic and global customers
  • Experienced board of directors and senior management team supported by skilled and qualified workforce
  • Consistent financial performance with focus on innovation and R&D capabilities

Who are its listed peers?

  • Sona BLW Precision Forgings Limited
  • Bosch Limited
  • ZF Commercial Vehicle Control Systems India Limited
  • Sundram Fasteners LimitedE
  • Endurance Technologies Limited

Why is the Company going public?

Given below are the objectives of the Company –

The Offer comprises a Fresh Issue by the company and an Offer for Sale by the selling shareholders. The company will not receive any proceeds from the Offer for Sale.

The Company proposes to utilise the Net Proceeds from the Fresh Issue towards funding of the following objects:

  • Funding capital expenditure requirements for the purchase of equipments/machineries of our manufacturing facilities
  • General Corporate Purposes

IPO Details

IPO Size ₹ 412.12 Crore *
Offer Mix Fresh Issue ₹ 180 Crore + Offer For Sell ₹ 232.12 Crore
Price Band ₹ 560 - ₹ 590
Lot Size 25 Shares (& in multiples thereof)
Face Value ₹ 5
Application Amount Min. ₹ 14,750 (1 lot) | Max. ₹ 1,91,750 (13 lots) [at upper price band]
Listing on NSE & BSE
Registrar Link Intime India Pvt Ltd.
Cut-off time for UPI Mandate Confirmation 03-March-2023 (up to 05:00 PM)
* at upper price band

Category Wise Availability *

QIB ₹ 309.09 Crore
(75% of the Issue Size)
NIB ₹ 61.82 Crore
(15% of the Issue Size)
Retail ₹ 41.21 Crore
(10% of the Issue Size)
* at upper price band

Indicative Issue Timeline

Activity Date
IPO Opens March 01, 2023
IPO Closes March 03, 2023
Finalization of the basis of allotment March 09, 2023
Unblocking of funds / Initiation of refunds March 10, 2023
Credit of equity shares to Demat accounts March 13, 2023
Listing of equity shares March 14, 2023
Source: Company RHP  Alternate Text


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