A three-decade-old maker of adhesive tapes and car-care products for the automotive OEM and refinish markets opens its Rs 53.40 crore NSE SME issue on August 25 — improving margins, a near-debt-free balance sheet, and a two-unit capacity expansion.
An automotive components company engaged in manufacturing and trading products for the Automotive OEM and Auto Refinish markets plans to raise Rs 53.40 crore via an SME listing on NSE SME.
Sumax Engineering Ltd, incorporated in 1994 and making adhesive tapes, masking films and car-care products, opens for subscription on August 25 with the issue closing on August 28. The company operates in a specialised niche of the automotive supply chain — consumables and components for the Automotive OEM (Original Equipment Manufacturer) and Auto Refinish markets. The business runs across two segments: manufacturing and trading.
The manufacturing portfolio is built around adhesive and surface-preparation products: adhesive tapes and die-cuts, pre-taped masking films, polishing and buffing compounds, buffing and foam pads, reflective tapes, graphics, and car-care products. The trading business complements this with tools, abrasives, body-shop consumables, accessories and aerosol products. Together they position Sumax as a broad-range supplier to vehicle manufacturers and the collision-repair and refinishing trade.
The product mix is shifting toward higher-value work. Sumax is increasingly focusing on value-added products such as fine-line tapes, adhesives and customised die-cuts for automotive OEMs, supporting better realisations. That shift shows up in the segment’s gross profit contribution, which rose from 55% in FY23 to 74% subsequently — a meaningful improvement in the quality of the revenue base.
The company has also built a diversified export footprint across key markets including Thailand, South Korea, Russia, Turkey, China, Vietnam, the USA, Saudi Arabia and Taiwan, supporting geographic diversification and reducing reliance on the domestic market. It is led by Chairman, Managing Director and Promoter Mr. Sudeep Mehta, who holds a Bachelor’s degree in Commerce from Osmania University and an MBA from the University of Poona, and brings over three decades of experience in the automotive and car-care products industry. The promoters are Sudeep Mehta and Smriti Mehta.
Issue Details
| Particulars | Details |
|---|---|
| Issue Opens | August 25, 2026 |
| Issue Closes | August 28, 2026 |
| Listing | NSE SME |
| Listing Date | September 2, 2026 |
| Price Band | Rs 95 – Rs 101 per share |
| Issue Size | Rs 53.40 crore |
| Fresh Issue | 42,91,200 shares |
| Offer for Sale | 9,96,000 shares |
| Market Maker | 2,66,400 shares |
| QIB / NII / Retail | 24,09,600 / 7,27,200 / 16,92,000 shares |
| Min. Application (Retail) | 2 lots / 2,400 shares / Rs 2,42,400 |
| Lead Manager | GYR Capital Advisors Pvt. Ltd. |
| Market Maker | Giriraj Stock Broking / Mansi Share & Stock Broking |
| Registrar | KFin Technologies Ltd. |
The objects of the issue are funding capital expenditure towards construction of proposed manufacturing Unit I (up to Rs 488.68 lakh) and Unit II (up to Rs 1,662.34 lakh), funding working capital requirements (up to Rs 1,200.00 lakh), and general corporate purposes. Ahead of the opening, the company raised Rs 14.50 crore from anchor investors, with the anchor bid on August 24.
Post-issue, promoters’ holding falls from 96.73% to 74.08%.
Price Band Analysis
At the upper price band of Rs 101, Sumax Engineering is valued at a post-issue P/E of 14.67x and a P/B of 2.41x, described as a reasonable valuation. The pricing appears broadly in line with comparable engineering companies, with Sumax positioned between key listed peers on P/E — suggesting the issue is neither aggressively priced nor significantly discounted. On pre-issue earnings, the P/E works out to about 11.66x, with a NAV of Rs 41.83 and EPS of Rs 8.66.
GMP Watch
Grey-market interest has been modest but positive. In tracked data, the Sumax Engineering IPO GMP made a high of ₹32 and a low of ₹20, both recorded on August 19. At the top of that range, the implied premium over the Rs 101 upper band is in the region of 20–30%. Independent reviewers have leaned toward a selective, fundamentals-led stance, flagging that final action should hinge on GMP staying healthy and on QIB and overall subscription demand near the close. As always, treat GMP as one unofficial, unregulated, unendorsed data point rather than a listing forecast — it can move quickly before listing day.
Financial Performance
| Particulars (Rs lakh) | FY24 | FY25 | FY26 |
|---|---|---|---|
| Revenue from Operations | 13,079.45 | 14,612.60 | 14,769.06 |
| EBITDA | 1,162.50 | 1,502.66 | 1,907.96 |
| EBITDA Margin (%) | 8.84 | 10.21 | 12.86 |
| PAT | 743.14 | 998.16 | 1,275.86 |
| PAT Margin (%) | 5.68 | 6.83 | 8.64 |
| RoE (%) | 19.12 | 20.44 | 20.71 |
| RoCE (%) | 23.34 | 24.64 | 23.86 |
| EPS (Rs) | 5.04 | 6.78 | 8.66 |
| Debt to Equity | 0.17 | 0.16 | 0.21 |
Revenue growth has been modest — from Rs 13,079.45 lakh in FY24 to Rs 14,769.06 lakh in FY26 — but the profitability story is stronger. Operating leverage drove the EBITDA margin from 8.84% in FY24 to 12.86% in FY26, and PAT margin from 5.68% to 8.64%, reflecting sustained margin expansion rather than a one-year spike. PAT rose from Rs 743.14 lakh to Rs 1,275.86 lakh over the same span.
RoE is around 20% and RoCE in the 23–25% band across all three years. Debt-to-equity has stayed near-negligible at 0.16–0.21x, making this an essentially debt-light business — a comfortable position from which to fund the planned capacity expansion. Revenue is overwhelmingly product-led, with Sale of Products at Rs 14,760.60 lakh of the Rs 14,769.06 lakh FY26 total.
Risks to Consider
Import dependence is the headline risk. With 76.65% of purchases in FY26 sourced from imports, primarily from China, Portugal and South Korea, the company remains exposed to geopolitical risks, trade restrictions, supply disruptions and foreign-exchange volatility.
Working-capital and cash-flow pressure has crept up. The company’s operating cycle lengthened in FY25, with inventory days rising to 64 and receivable days to 41, resulting in a sharp decline in operating cash flow to Rs 70.00 lakh from Rs 379.42 lakh in FY24 — worth watching even against an otherwise clean balance sheet.
Flat top-line growth is a concern. Revenue was near-stagnant between FY25 and FY26, so the profit growth has come almost entirely from margins rather than volume; if margins normalise, earnings growth could stall without a revenue re-acceleration.
Customer concentration is moderate but rising at the top — the top 1 customer contributed 13.20% of FY26 revenue (up from 8.97% in FY25), the top 5 40.48%, and the top 10 55.59%.
Automotive-sector dependence ties the business to OEM production cycles and refinish/aftermarket demand, both of which are cyclical and sensitive to broader auto-industry conditions.