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Indo Farm Equipment plans ₹260 crore IPO on Dec 31 to expand production, dealerships, and launch innovative tractors, including electric models.
Indo Farm Equipment Ltd, a Chandigarh-based tractor manufacturer, is set to raise ₹247-260 crore through its initial public offering (IPO). The IPO will open on December 31 and includes a fresh issue of 8.6 million equity shares and an offer for sale of 3.5 million shares by existing promoters. The face value of each share is ₹10, with a price band between ₹204 and ₹215 per share.
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Indo Farm achieved ₹375 crore in operating revenue during FY24 and targets crossing ₹500 crore by FY25-26. The company manufactures tractors under the Indo Farm and Indo Power brands, offering models ranging from 16 HP to 100 HP, priced between ₹3 lakh and ₹12 lakh. Apart from tractors, the company produces harvester combines, rotavators, and other agricultural equipment.
Over the last 20 years, Indo Farm has invested ₹200 crore in its production facilities in Baddi, Himachal Pradesh. These facilities have an annual capacity of producing 12,000 tractors and 1,280 cranes. According to Joint Managing Director Anshul Khadwalia, the company focuses on in-house production processes, including foundry operations, gear shops, machining, gearbox assembly, and engine manufacturing.
To further support farmers, Indo Farm plans to invest ₹45 crore in its non-banking financial company (NBFC), Barota Finance, which provides financing options for tractor purchases.
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Indo Farm plans to double its dealership network from 170 to over 340 in the next two to three years. Post-IPO, the company aims to increase tractor sales from 4,500-5,000 units to 6,500 units, eventually reaching 10,000 units annually by FY27.
Recent developments include launching a new tractor model for the European market and two models for India. The company is also working on an electric tractor prototype, which is expected to enter production by FY26-27.
Indo Farm competes with established players like Mahindra, Escorts Kubota, John Deere, and TAFE in the tractor segment, as well as firms like Bauer AG and Liebherr-International AG in the crane segment. Despite stiff competition, Indo Farm is optimistic about its growth prospects.
The Indian agricultural tractor market is projected to grow at a CAGR of 6.7%, reaching USD 7.42 billion by 2024. Increased demand for higher-HP tractors and rising household incomes are key factors driving this growth. Indo Farm aims to leverage these trends to solidify its position in the market and achieve its ambitious revenue targets.
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The IPO marks a significant milestone for Indo Farm Equipment Ltd as it seeks to expand its operations, boost production capacity, and strengthen its market presence. With plans for dealership expansion, electric tractor development, and improved financing options, the company is poised for growth in a rapidly evolving agricultural equipment market.