Born in an IIT Bombay lab, built into a 35% market share business — Sedemac is a technology India’s Deeptech Auto-Electronics Pioneer that Comes to Market
Sedemac Mechatronics is not a conventional auto ancillary story. It began as a college project at IIT Bombay in 2004, when Manish Sharma and two seniors started working on electronic automation for two and three-wheelers. By 2007 it was a company. Today it holds approximately 35 per cent market share in India’s domestic ISG ECU market and has its sensor-less units installed in more than 9.2 million vehicles in India and abroad. The IPO opens today, March 4 and closes March 6.
The Offer at a Glance
| Particulars | Details |
|---|---|
| Issue Size | Rs 1,087.45 Cr |
| Price Band | Rs 1,287 – Rs 1,352 per share |
| Face Value | Rs 10 per share |
| Lot Size | 11 Shares |
| Minimum Investment (Retail) | Rs 14,872 |
| Minimum Investment (sNII) | Rs 2,08,208 (154 shares) |
| Minimum Investment (bNII) | Rs 10,11,296 (748 shares) |
| Issue Opens | March 4, 2026 |
| Issue Closes | March 6, 2026 |
| Allotment | March 9, 2026 |
| Listing Date | March 11, 2026 (BSE & NSE) |
| Post-Issue Market Cap | Rs 5,684 – Rs 5,971 Cr |
| Employee Discount | Rs 128 per share |
| Anchor Investors | Rs 326 Cr raised |
| BRLMs | Axis Capital, ICICI Securities, Avendus Capital |
| Registrar | MUFG Intime India Pvt. Ltd |
This is a 100 per cent offer for sale of 80,43,300 equity shares. No fresh capital comes into the company. Every rupee raised goes to selling shareholders, including early investors A91 Emerging Fund, Xponentia Opportunities Fund and 360 One. Promoters Manish Sharma and Ashwini Amit Dixit are also selling a portion of their holdings.
The Financials
| Particulars (Rs Cr) | 9M FY26 | FY25 | FY24 | FY23 |
|---|---|---|---|---|
| Revenue from Operations | 770.67 | 658.36 | 530.65 | 423.03 |
| Revenue Growth (%) | — | 24.07% | 25.44% | — |
| EBITDA | 161.07 | 125.07 | 83.12 | 54.24 |
| EBITDA Margin (%) | 20.90% | 19.00% | 15.66% | 12.82% |
| Net Profit | 71.50 | 47.05 | 5.88 | 8.57 |
| Net Profit Margin (%) | 9.28% | 7.15% | 1.11% | 2.03% |
| EPS – Basic (Rs) | 16.59 | 10.93 | 1.45 | 2.12 |
| ROCE (%) | 32.52% | 33.79% | 28.87% | 17.51% |
| ROE (%) | 20.06% | 22.01% | 4.92% | 7.84% |
| Total Borrowings | 46.89 | 49.62 | 150.62 | 109.61 |
| Net Worth | 411.23 | 303.88 | 124.43 | 115.22 |
| Cash Flow from Operations | 67.12 | 90.91 | 60.75 | 77.67 |
Revenue has grown at over 25 per cent annually for two consecutive years. EBITDA margins have expanded from 12.82 per cent in FY23 to 20.90 per cent in the nine months to December 2025. Net profit, barely visible at Rs 5.88 crore in FY24, has surged to Rs 71.50 crore in nine months of FY26. Return on capital employed is above 32 per cent. Borrowings have more than halved from their FY24 peak. Operating cash flows are consistent across all four periods.
Valuations
At the upper price band of Rs 1,352, Sedemac is being offered at a price-to-earnings ratio of approximately 125 times on annualised FY26 earnings — a significant premium that reflects the company’s technology positioning and rapid margin expansion rather than current-year earnings alone. On a price-to-sales basis, the post-issue market cap of Rs 5,971 crore against annualised FY26 revenue of roughly Rs 1,027 crore implies a P/S multiple of approximately 5.8 times.
| Metric | Sedemac (FY26 Annualised) | Peer Context |
|---|---|---|
| P/E Ratio | ~125x | Minda Industries: ~45x, Bosch India: ~55x |
| P/S Multiple | ~5.8x | Typical auto-ancillary range: 1.5x–4x |
| EBITDA Margin | 20.90% | Auto-ancillary sector average: 10–14% |
| ROCE | 32.52% | Sector leaders typically 18–25% |
| Revenue CAGR (FY23–FY25) | ~25% | Sector average: 8–12% |
| Net Profit Margin | 9.28% | Sector average: 4–7% |
The P/E multiple is materially higher than conventional auto-ancillary peers. However, Sedemac is not a conventional auto-ancillary company. Its EBITDA margins at 20.90 per cent and ROCE above 32 per cent are significantly ahead of the sector, and its revenue growth rate of 25 per cent annually is nearly three times the industry average.
The more relevant comparison may be with listed electronics and embedded systems companies rather than traditional component makers, where technology-led businesses with defensible IP routinely command P/E multiples in the 80 to 150 times range. On a price-to-book basis, the issue is priced at approximately 14.4 times post-issue book value of Rs 94.02 NAV per share — again a premium, but consistent with a business generating 32 per cent ROCE.
As of today, March 4, the GMP stands negative per share against the upper price band of Rs 1,352, which seems to suggest the IPO may open at a discount.
Investor selling shareholders reduce from 55 per cent to 37 per cent. Promoter holding stands at 22 per cent post-issue.
