Dhoot Transmission has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), marking the first step towards its Initial Public Offering. The company is seeking to raise capital through this public issue, with an issue size ranging from ₹14,093 crore to ₹500,000 crore. The proposed price band for the shares is set between ₹829 and ₹871.

Company Overview

Dhoot Transmission operates in the transmission sector. The company has filed its DRHP to list on Indian stock exchanges, aiming to raise funds for corporate purposes. As per the filing, the minimum bid quantity for retail investors is set at 17 shares.

Offer Details

The key details of the Dhoot Transmission IPO are as follows:

The objects of the issue include raising capital for business expansion and working capital requirements. The timeline for the IPO opening and closing dates will be announced after SEBI approval.

Financial Highlights

Specific financial data such as revenue and profit trends were not detailed in the provided filing summary. Investors should refer to the complete DRHP document available on the exchange websites for comprehensive financial statements.

Risk Factors

Potential risks associated with the investment include market volatility, regulatory changes in the transmission sector, and execution risks related to business operations. Detailed risk factors are outlined in the DRHP.

Valuation & Peer Comparison

With a price band of ₹829 to ₹871, the valuation will be assessed against peers in the transmission sector once the final issue size is determined. The subscription status currently stands at 0x across all categories including QIB, NII, and Retail.

Bottom Line

Dhoot Transmission’s IPO is in the early stages following the DRHP filing. Investors should wait for the price band finalization and detailed financial disclosures before making any decisions. The current subscription status is 0x for Qualified Institutional Buyers, Non-Institutional Buyers, and Retail investors.

Dhoot Transmission Limited (DTL), a leading designer and manufacturer of wiring harnesses and electronic components for the automotive sector, has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). The company aims to raise funds through a fresh issue to repay borrowings, invest in subsidiaries, and set up new manufacturing plants. With a commanding market share in the Indian two-wheeler (2W) and three-wheeler (3W) segments, DTL is positioning itself as a key beneficiary of India’s electric vehicle (EV) transition.

Company Overview

Founded in 1998 and headquartered in Chakan, Pune, Maharashtra, Dhoot Transmission Limited specializes in critical wiring harnesses, sensors, controllers, switches, terminals, connectors, junction boxes, high-voltage interconnection systems, and data cables. The company serves both Internal Combustion Engine (ICE) and Electric Vehicle (EV) platforms across automotive and non-automotive applications.

DTL holds a dominant position in the Indian market:

• Combined 2W & 3W Market Share (FY2026): 41.03%
• Electric 2W & 3W Market Share: Close to 70%
• 2W Market Share (FY2026): 37.58%
• 3W Market Share (FY2026): More than 70%

The company operates 22 manufacturing facilities, 3 engineering centers, and 7 warehouses across India and internationally, including through its subsidiary Dhoot Transmission UK Limited. It serves marquee OEM customers, with Bajaj Auto Limited being the largest customer, contributing 31.84% of total revenue in FY2026. The top five customers contributed 71.56% of revenue, while the top ten contributed 80.93%. DTL maintains average relationships of 13 years with its top five customers.

Approximately 95% of DTL’s auto product portfolio is EV-focused or powertrain-neutral. EV-related revenue share increased from 16.19% in FY2024 to 24.18% in FY2026. The company is backed by BC Asia XV, which holds 55% pre-Offer equity share capital.

Offer Details

As per the DRHP, the key dates for the IPO are as follows:

The issue structure includes a fresh issue component. The price band, lot size, and offer for sale (OFS) details are not yet available in the DRHP. Standard SEBI reservation norms typically apply, with allocations for Qualified Institutional Buyers (QIB), Non-Institutional Investors (NII/HNI), and Retail Individual Investors (RII).

Objects of the Issue: The proceeds from the fresh issue will be utilized for the following purposes:

1. Repayment/prepayment of outstanding borrowings: ₹464.80 Crore
2. Investment in Subsidiaries for repayment of their borrowings: ₹301.77 Crore
3. Setting up new wiring harness manufacturing plants (Jhajjar, Haryana & Hosur, Tamil Nadu): ₹150.00 Crore
4. Funding inorganic growth through acquisitions and general corporate purposes: Not Specified (Residual)

Total identified proceeds for items 1–3 amount to ₹916.57 Crore.

Financial Highlights

Dhoot Transmission has demonstrated strong revenue and profit growth over the last three fiscal years. All figures are on a consolidated basis.

Revenue from operations grew at a CAGR of ~27% from FY2024 to FY2026. PAT grew at a CAGR of 32.84% over the same period. However, margins have seen some compression:

• PBT Margin declined from 13.87% (FY2024) to 11.40% (FY2026).
• PAT Margin declined from 10.68% (FY2024) to 8.77% (FY2026).

Raw material costs, primarily copper, polymers, and brass, accounted for 67.82% of revenue from operations in FY2026, up from 65.37% in FY2024.

Risk Factors

Investors should consider the following material risks disclosed in the DRHP:

1. Concentration Risk in 2W and 3W Sectors: Approximately 78% of revenue is derived from the 2W and 3W automotive sectors. Adverse changes in these segments could materially impact the business.
2. Customer Concentration: Top 10 customers contributed 80.93% of revenue in FY2026. Bajaj Auto Limited alone accounted for 31.84%. Loss of key customers could severely affect operations.
3. Lack of Long-term Volume Commitments: Contracts are requirement-based with non-binding forecast volumes. Customers can modify, reschedule, or cancel orders without compensation for lost profits.
4. Raw Material Cost Volatility: High dependence on third-party suppliers for copper, polymers, and brass exposes the company to price volatility and supply disruptions.
5. Debt Obligations: Total borrowings stood at ₹8,413.92 million as of March 31, 2026. Loan agreements contain negative covenants and financial ratio requirements.

Valuation & Peer Comparison

Specific peer comparison data and valuation multiples such as P/E or P/B ratios are not available in the DRHP as the price band has not been announced. However, DTL’s strong revenue CAGR (27%) and PAT CAGR (32.84%) suggest a growth-oriented profile. The company’s leadership in the electric 2W/3W segment (70% market share) provides a structural advantage. Investors should monitor the final RHP for pricing details and peer benchmarking.

Bottom Line

Dhoot Transmission Limited presents a compelling case as a market leader in the 2W and 3W wiring harness segment with significant exposure to the growing EV market. The company’s strong revenue growth and institutional backing by BC Asia XV are positive indicators. However, investors must weigh these against concerns regarding margin compression, high customer concentration, and lack of long-term volume commitments. The final investment decision will depend on the price band revealed in the Red Herring Prospectus.