Bonfiglioli Transmissions Limited IPO

01At a glance

Bonfiglioli Transmissions IPO date, price band and lot size

• Price band: ₹558 to ₹586 a share, from NSE's issue page; the prospectus leaves the price blank (RHP p.2).
• Lot size: 25 shares, from NSE's issue page; one lot costs ₹14,650 at the upper band (our arithmetic).
• Dates: anchor bidding on October 14, 2026; the offer opens on October 15, 2026 and closes on October 19, 2026 (RHP p.1).
• Size: an offer for sale of up to 43,239,042 shares by Bonfiglioli S.p.A., about ₹2,533.8 crore at the upper band and ₹2,412.7 crore at the lower band (our arithmetic, RHP p.1). There is no fresh issue (RHP p.1).
• Employee reservation: up to 50,000 shares for eligible employees (RHP p.2).
• Who gets the shares: not more than 50% of the net offer for qualified institutional buyers, not less than 15% for non-institutional investors and not less than 35% for retail individual investors (RHP p.2, RHP p.3).
• Lead managers and registrar: Axis Capital Limited, BNP Paribas, ICICI Securities Limited and Jefferies India Private Limited; MUFG Intime India Private Limited is the registrar (RHP p.1).

What the company does: designs and makes gear motors, gearboxes and drive systems, used in factory machines, construction and farm machines and wind turbines, under the Bonfiglioli brand licensed from its parent (RHP p.210, RHP p.30).

Who pays it: more than 930 customers served directly in the six months to June 2026, plus 44 dealers (RHP p.212). Named customers include Suzlon Energy Limited, Nordex India Private Limited, JCB India Limited and GMM Pfaudler Limited (RHP p.211). The largest customer was 11.43% of 2025 revenue from customers and the top ten 36.60% (RHP p.32).

Why it is raising money: it is not. The whole offer is a sale by Bonfiglioli S.p.A., and the company receives no proceeds (RHP p.111).

How fast it has grown: revenue from ₹1,687.3 crore in 2023 to ₹2,013.5 crore in 2025, about 9.2% a year, and profit after tax from ₹146.7 crore to ₹237.9 crore, about 27.4% a year (our arithmetic, RHP p.72).

The one thing to understand: this is a profitable subsidiary run inside its parent's group. It pays Bonfiglioli S.p.A. a royalty of 6% of net sales of licensed products, ₹88.8 crore in 2025 (RHP p.258, RHP p.87), buys its largest share of materials from a group company (RHP p.26), and paid its parent dividends of ₹92.7 crore in 2025 and ₹110.0 crore in the six months to June 2026 (RHP p.87).

02The business, in plain words

What Bonfiglioli Transmissions does

The company was incorporated in Chennai on June 23, 1998 as Bonfiglioli Deepak Private Limited, became Bonfiglioli Transmissions Private Limited the same year, and a public company on September 16, 2025 (RHP p.2). Gearbox and gear motor production began at Thirumudivakkam, Tamil Nadu in 2000, wind drives in 2006 and off-highway drives in 2010; Mannur, Tamil Nadu opened in 2011 and Talegaon, Maharashtra in 2023 (RHP p.255).

What it supplies, by vertical, share of 2025 revenue (RHP p.212):

• Industry and automation: gear motors and gearboxes for material handling, chemicals, mining, food, textiles and similar plants, 40.95%.
• Off-highway mobility: swing, track, wheel, drum and hoist drives for excavators, concrete, road and farm machines, 25.18%.
• Wind: yaw and pitch drives that turn a wind turbine and its blades, 31.53%.
• Others: scrap, export incentives and parts billed to vendors, 2.34%.

A machine maker needs a drive → it orders a standard gear motor from the catalogue, or co-engineers a drive with the company → the company machines gears and housings and assembles them at its three plants from local and imported parts → it delivers and is paid on credit of usually 30 to 120 days (RHP p.28, RHP p.51).

The parent, Bonfiglioli S.p.A., licenses the company to make and supply its products in India, Nepal, Bangladesh, Pakistan and Sri Lanka, on a one-year licence that renews each year (RHP p.30). The intellectual property in co-engineered products stays with the group (RHP p.34). The group's India R&D Centre sits in a sister company, Bonfiglioli Technology Space Private Limited (RHP p.213).

Earnings equation: Revenue ≈ units sold × price, less materials, which were 61.53% of 2025 revenue, and a royalty of 6% of licensed sales (RHP p.27, RHP p.258). The plants made 341,133 gear motors and gearboxes in 2025 (RHP p.214). The prospectus does not give an average price per unit.

03Where the money comes from

Source: RHP p.119.

By channel, 2025 (RHP p.213):

• Direct sales ₹1,274.6 crore, 63.30%; dealer sales ₹390.9 crore, 19.42%.
• Sales to group companies ₹306.5 crore, 15.22%; others ₹41.5 crore, 2.06%.

By country, 2025: India 72.49%, the USA 15.52%, Italy 3.06%, Germany 2.20%, China 0.94% (RHP p.40). Two product lines carry most of the sales: yaw and pitch drives were 31.53% of 2025 revenue and low to medium duty gear motors 36.49% (RHP p.45). Co-engineered products were 53.73% (RHP p.34).

Bonfiglioli Transmissions customers: how concentrated the revenue is

Source: RHP p.32. The largest customer brought ₹226.5 crore in 2025 (RHP p.32). Customers are not named against these figures for lack of consent (RHP p.33). Group companies, including Bonfiglioli Riduttori S.p.A., Bonfiglioli USA Inc. and Bonfiglioli Deutschland GmbH, are among the top ten (RHP p.33); all sales to related parties were ₹306.5 crore, 15.46% of 2025 revenue from customers, and 20.24% in the six months to June 2026 (RHP p.34). Read from the filing: revenue does not hang on one customer, but about one rupee in three comes from ten, and about one in five in the latest half year from the parent's own group.

04The growth record

Bonfiglioli Transmissions financials: revenue, profit and margins

Source: RHP p.71, RHP p.72, RHP p.75, RHP p.119, RHP p.120. The six-month figures are not annualised.

Source: RHP p.119, RHP p.120.

Our arithmetic over 2023 to 2025 (RHP p.72, RHP p.119):

• Revenue grew about 9.2% a year (our arithmetic, RHP p.72).
• EBITDA grew about 23.3% a year (our arithmetic, RHP p.119).
• Profit after tax grew about 27.4% a year (our arithmetic, RHP p.72).
• EBITDA margin rose 396 basis points, 14.5% → 18.4% (RHP p.119); PAT margin rose 314 basis points.

In the six months to June 2026 revenue rose 17.86% on the same half of 2025 (RHP p.374).

What sits around the record:

• Size: revenue went ₹1,687.3 cr → ₹2,013.5 cr from 2023 to 2025 (RHP p.72), and profit after tax ₹146.7 cr → ₹237.9 cr (RHP p.72).
• Cash: operating cash flow was ₹187.7 crore in 2025 (RHP p.75), and over 2023 to 2025 about equal to profit after tax, 1.0 times (our arithmetic, RHP p.72, RHP p.75).
• Other income was ₹10.1 crore in 2025, about 3.1% of profit before tax of ₹325.2 crore (our arithmetic, RHP p.72).
• Customers: the largest customer was 11.4% of 2025 revenue from customers and the top ten 36.6% (RHP p.32).
• Suppliers: the largest supplier, group company Bonfiglioli Riduttori S.p.A., was 15.2% of 2025 purchases (RHP p.26).
• Debt: no borrowings at December 2025; net cash of ₹160.4 crore (RHP p.120), so net debt was about −0.4× 2025 EBITDA (our arithmetic, RHP p.120). Return on capital employed was 34.1% in 2025 (RHP p.120).
• Related parties: royalty to Bonfiglioli S.p.A. was ₹88.8 crore in 2025 (RHP p.87); expenses with related parties were ₹421.6 crore, 24.83% of total expenses (RHP p.31).
• Contingent liabilities: ₹3.1 crore of disputed tax at June 30, 2026 (RHP p.51).
• Cases against promoters: 4 tax proceedings, ₹3.6 crore, with amounts stated in euros (RHP p.408); no criminal or regulatory case (RHP p.407).
• The offer: no fresh issue (RHP p.1); an offer for sale of up to 43,239,042 shares (RHP p.1), about ₹2,533.8 crore at the upper band (our arithmetic, RHP p.1).
• Valuation at the upper band: a market capitalisation of ₹11,016.6 crore (our arithmetic, RHP p.68) and a P/E of 46.3× on 2025 profit after tax (our arithmetic, RHP p.72, RHP p.68). The median P/E of the four peers the prospectus names is 55.7× (our arithmetic, RHP p.117), so the issue is −17% against the peer median (our arithmetic, RHP p.117). Section 16 has the detail.
• Industry: power transmission products, capital goods and engineering in the fixed list (RHP p.136).

05What the growth is made of

Revenue rose by ₹326.2 crore from 2023 to 2025 (our arithmetic, RHP p.72). The prospectus explains it this way:

• 2024: up 9.89%, driven by gearbox sales, which rose 15.15% to ₹1,107.3 crore (RHP p.380).
• 2025: up 8.59%. Off-highway revenue rose 16.35% on higher output at construction and farm machine makers, industry and automation 7.79% on textile, leather and construction demand, and wind 5.90%, with US sales up and some other export markets down (RHP p.378).
• Six months to June 2026: up 17.86%; off-highway revenue rose 36.36% (RHP p.374).

By vertical, ₹ crore (RHP p.212):

• Industry and automation: ₹727.0 cr in 2023 → ₹824.4 cr in 2025.
• Off-highway: ₹425.8 cr → ₹507.0 cr.
• Wind: ₹501.0 cr → ₹634.8 cr.

Sales to customers in the USA went from ₹157.7 crore in 2023 to ₹307.7 crore in 2025 (RHP p.40). On margins, materials fell from 63.59% of revenue in 2024 to 62.13% in 2025, which the company puts down to local sourcing, and sub-contracting fell 17.32% as machining moved in house at Thirumudivakkam (RHP p.378, RHP p.379). 2024 and 2025 also carried one-off income from a transfer pricing settlement, ₹14.1 crore and ₹8.0 crore (RHP p.378).

The offer document gives units made (341,133 in 2025) but not units sold or prices by product, so the increase cannot be separated into volume and price (RHP p.214).

06Earnings quality

The item that needs explaining is the working capital in the latest half year. Trade receivables went from ₹517.7 crore at December 2025 to ₹532.5 crore at June 2026, and inventories from ₹319.2 crore to ₹377.6 crore (RHP p.71). Credit terms run 30 to 120 days, and some customers get up to 240 days (RHP p.51). Finance costs of ₹7.8 crore in 2025 were mainly discounts on early payment by some customers, as the company had no borrowings (RHP p.379).

07The balance sheet

At December 31, 2025 (RHP p.71):

• Cash ₹153.2 crore and other bank balances ₹10.0 crore; borrowings nil.
• Trade receivables ₹517.7 crore; inventories ₹319.2 crore.
• Property, plant and equipment ₹269.2 crore; capital work in progress ₹12.3 crore.
• Lease liabilities ₹2.8 crore.
• Trade payables ₹330.2 crore.
• Loans to a related party ₹11.9 crore, to Bonfiglioli Technology Space Private Limited (RHP p.71, RHP p.83).

At June 30, 2026 cash was ₹140.2 crore and net worth ₹1,034.3 crore (RHP p.71). Bank guarantees and letters of credit of ₹5.8 crore were outstanding against sanctioned limits of ₹187.7 crore, and no fund-based limit was drawn (RHP p.403). Contingent liabilities were ₹3.1 crore of disputed income and indirect tax (RHP p.51).

Cash returned to the parent: dividends paid of ₹65.6 crore in 2023, ₹46.4 crore in 2024, ₹115.3 crore in 2025 and ₹110.0 crore in the six months to June 2026, and a share buyback of ₹72.0 crore in 2024 (RHP p.75).

Source: RHP p.71, RHP p.98.

08What the money is for

Bonfiglioli Transmissions IPO objects: what the money is for

Source: RHP p.111; amount our arithmetic on 43,239,042 shares at ₹586.

The stated objects are to carry out the offer for sale and to get the benefits of listing (RHP p.111). The selling shareholder bears the offer expenses, other than listing fees and some audit and corporate advertising costs the company pays (RHP p.111). The offer expense estimate is left blank (RHP p.111).

Into the business nothing: there is no fresh issue (RHP p.1). To selling shareholders about ₹2,533.8 crore at the upper band, to Bonfiglioli S.p.A. (our arithmetic, RHP p.1).

09Who is selling

Bonfiglioli Transmissions IPO offer for sale: who is selling

Source: RHP p.1, RHP p.102; the last column is our arithmetic. Its weighted average cost of acquisition is ₹6.77 a share (RHP p.1). It acquired no shares in the three years before the prospectus other than bonus shares (RHP p.108).

10Promoters

The promoters are Sonia Bonfiglioli, Luciano Bonfiglioli, Luisa Lusardi, BON-FI S.r.l. and Bonfiglioli S.p.A. (RHP p.279). The prospectus names Luisa Lusardi as the mother of Sonia Bonfiglioli and Luciano Bonfiglioli, and the two as siblings (RHP p.283).

• Bonfiglioli S.p.A.: incorporated in Italy in 1967, a holding company, and owner of all the shares (RHP p.280). BON-FI S.r.l. holds 69.54% of it; Luisa Lusardi holds the usufruct of a further 20.23% with Sonia Bonfiglioli as bare owner, and of 10.23% with Luciano Bonfiglioli as bare owner (RHP p.280, RHP p.281).
• BON-FI S.r.l.: incorporated in 2017, held 59.92% by Sonia Bonfiglioli and 40.08% by Luciano Bonfiglioli (RHP p.281).
• Sonia Bonfiglioli, 62, is a non-executive director of the company and chairperson of Bonfiglioli S.p.A. (RHP p.279, RHP p.280).
• Luciano Bonfiglioli, 60, sits on the board of Bonfiglioli S.p.A. (RHP p.279).
• Luisa Lusardi, 93, was previously associated with Bonfiglioli S.p.A.; records of the promoter's educational qualifications could not be traced (RHP p.280, RHP p.46).

The group reported consolidated revenue of €1,172.94 million in 2025 and operates 18 production sites in 80 countries, according to the industry report (RHP p.210).

What the company pays: the non-executive promoter director receives no remuneration (RHP p.264). The executive directors are Kennady V Kaippally, Managing Director, paid ₹1.97 crore in 2025, and Gatham Anandhan Balaji, Whole-Time Director and CFO, paid ₹1.39 crore (RHP p.264).

Group entities that deal with the company: Bonfiglioli S.p.A. (royalty, service fees, dividends), Bonfiglioli Riduttori S.p.A. (the largest supplier), Bonfiglioli Technology Space Private Limited (the India R&D centre, and borrower of company loans) and Bonfiglioli Drive Solutions Private Limited (seller of a business to the company and holder of the land for a planned plant) (RHP p.26, RHP p.83, RHP p.257, RHP p.31). None of the parent's shares in the company are pledged (RHP p.102).

Promoter economics: Bonfiglioli S.p.A. subscribed for shares at ₹10 each from 1999 to 2012, at ₹68 in a December 2021 rights issue, sold 2,610,620 shares back to the company at ₹124.30 in May 2024, and received 62,665,278 bonus shares in January 2026 (RHP p.102, RHP p.103).

11Who already owns it

Bonfiglioli Transmissions promoter holding before and after the IPO

Source: RHP p.102, RHP p.106. The company has seven shareholders: the parent and six nominees who hold shares on its behalf (RHP p.107). No other holder has 1% or more (RHP p.107).

After the offer, with all 43,239,042 shares sold and no new shares issued, Bonfiglioli S.p.A. would hold 144,756,792 of 187,995,834 shares, so promoter holding goes 100.0% → 77.0% (our arithmetic, RHP p.102, RHP p.68).

12What changed just before the IPO

• A global capability centre business was sold to group company Bonfiglioli Technology Space Private Limited by slump sale for ₹11.6 crore under an agreement of September 30, 2024 (RHP p.257); staff fell from 752 to 601 as a result (RHP p.47).
• A gear components business was bought from group company Bonfiglioli Drive Solutions Private Limited for ₹21.4 crore under an agreement of December 15, 2025 (RHP p.257).
• Electric motor production started at Mannur in October 2025 (RHP p.38).
• The company bought back 5,792,438 shares at ₹124.30 from Bonfiglioli S.p.A. and Bonfiglioli Vectron GmbH in May 2024 (RHP p.100).
• It became a public company on September 16, 2025 (RHP p.2).
• A 1:2 bonus issue of 62,665,278 shares was allotted in January 2026 (RHP p.100). No share split (RHP p.100). The last priced allotment was a rights issue at ₹68 a share in December 2021 (RHP p.100).
• No change of statutory auditor in the last three years; S.R. Batliboi & Associates LLP is the auditor (RHP p.93).
• Borrowings of ₹110.8 crore at December 2023 were repaid in 2024 (RHP p.71, RHP p.75).
• Two new independent directors and a new non-executive director joined the board on February 3, 2026 (RHP p.261, RHP p.262).
• Revenue went ₹1,687.3 cr → ₹2,013.5 cr and profit after tax ₹146.7 cr → ₹237.9 cr from 2023 to 2025 (RHP p.72); receivable days went 89 → 94 (RHP p.120).
• The company secretary post was vacant for 194 days in 2024, and the company has applied to the Registrar of Companies for adjudication (RHP p.407).

13Capacity and expansion

Capacity is measured in machine hours, 2025 (RHP p.36, RHP p.37):

In the six months to June 2026 utilisation was 80.74% at the Thirumudivakkam machine shop, 61.46% in its assembly, 77.90% at Mannur assembly, 72.72% at a new Mannur machine shop and 76.99% at Talegaon (RHP p.36, RHP p.37). The company made 11,857 SKUs in 2025 (RHP p.37). Mannur runs one shift, so its hours are not comparable across years (RHP p.37).

Thirumudivakkam makes off-highway and wind products; Mannur and Talegaon make industry and automation products (RHP p.28). Mannur and Talegaon are on leased land; the Mannur lease runs to July 31, 2029 (RHP p.39).

The company plans a heavy-duty gearbox plant at Talegaon on land held by group company Bonfiglioli Drive Solutions Private Limited, whose leasehold transfer is in progress (RHP p.38). The offer funds nothing, and the prospectus does not give the plant's cost, capacity or start date. Spending on property and equipment was ₹54.0 crore in 2025 (RHP p.75).

14Market size and industry structure

Bonfiglioli Transmissions industry: market size and growth

The industry chapter is drawn from "Market Potential Assessment of Power Transmission Products Across Industry & Automation, Mobility, Wind Solutions", dated September 28, 2026, by Frost & Sullivan, commissioned and paid for by the company (RHP p.136).

As claimed: the report puts the global industrial gearbox market at US$9.1 billion in 2024 and projects US$12.1 billion by 2031, about 4.9% a year (RHP p.144), and global industrial gear motors at US$5.6 billion in 2025, projected at US$7.6 billion by 2031 (RHP p.150).

The part that is addressable: India, in four segments the report sizes for Fiscal 2026 (the Indian year to March), all from the commissioned report:

Source: RHP p.156, RHP p.161, RHP p.173, RHP p.183. Together the four come to about ₹9,890 crore in FY2026 (our arithmetic).

What the company is today: revenue of ₹2,013.5 crore in 2025 (RHP p.72), of which 27.51% came from customers outside India (RHP p.119). The report gives it a 25.0% share of Indian gear motors below 15 kNm in 2025 (RHP p.164), 26.0% of Indian off-highway drives (RHP p.175) and 67.9% of wind turbine drives among domestic manufacturers (RHP p.184). Globally the report puts the Bonfiglioli brand at 8% of gear motors below 15 kNm, behind SEW Eurodrive at 32% and Nord at 15% (RHP p.153).

Size over time: the report projects the Indian gearbox market to grow about 8.1% a year from FY2026 to FY2031 (RHP p.157). Within gear motors it projects helical units to grow 8.7% a year and planetary 9.9% (RHP p.161). In off-highway drives it projects propulsion drives, the largest group, to grow from ₹860 crore in FY2026 to ₹1,400 crore by FY2031 (RHP p.173). In wind, it projects yaw drives at about 10.1% a year and pitch drives at about 9.6% (RHP p.183).

Segments: the report divides gearboxes and gear motors by type (helical, bevel, planetary, worm) and by user industry, with cement, steel and sugar the largest users of Indian gearboxes (RHP p.156); off-highway drives by function and machine, with excavators the largest (RHP p.173); and wind drives into yaw and pitch (RHP p.183). The company sells mainly low and medium duty gear motors, off-highway drives and yaw and pitch drives, and wants to grow in heavy-duty gearboxes (RHP p.223).

What drives demand: new plants account for about 55% of Indian gearbox demand and replacements about 45% (RHP p.157); for gear motors the split is about 60% and 40% (RHP p.162). The report names warehousing and logistics investment of over ₹50,000 crore (RHP p.162), mining and infrastructure capital spending (RHP p.175), a national goal of more than 100 GW of wind by 2030 with tenders of at least 10 GW a year until Fiscal 28 (RHP p.183), and the repowering of 12 to 14 GW of old turbines (RHP p.183). New installations are about 90% of wind drive demand (RHP p.183).

Structure: Indian gear motors have about 14 active players, and Bonfiglioli, SEW-Eurodrive, Power Build and Nord together hold nearly 73% (RHP p.163). In off-highway drives the report names Tata Hitachi (14.6%), SUNGBO (13.2%), Nabtesco (7.7%), Doosan (5.9%) and L&T (4.6%), several of them making drives for their own machines (RHP p.175). In wind drives, Liebherr has 6.9% and DHHI 5.2% (RHP p.184). The report cites entry barriers in capital, long qualification by machine makers and service networks (RHP p.159).

Inputs and trade: parts are tied to steel, aluminium and cast iron prices (RHP p.28). The company imported 28.90% of materials consumed in 2025, including electric motors from Vietnam, hydraulic motors from Japan, bearings from China and parts from its parent in Italy (RHP p.28). It exports to the USA, Italy, Germany and China among others (RHP p.40).

Rules: factory licences, pollution control consents and hazardous waste authorisations for each plant (RHP p.409). The report cites IE3 and IE4 energy efficiency standards for motors as pushing demand toward newer units (RHP p.163).

What the chapter says can go wrong: in gear motors, worm gear designs losing ground, gearless direct drives for small loads and dependence on imported electronics (RHP p.163); in gearboxes generally, servo and direct-drive systems, low-cost Chinese makers and slow capital spending in cement, mining and steel (RHP p.153); in off-highway, fragmented demand, rental fleets that delay purchases and low-cost Asian suppliers (RHP p.175); in wind, delays in tenders and pressure on turbine prices that is passed to suppliers (RHP p.184).

15Competitive position

Bonfiglioli Transmissions competitors

Source: RHP p.117 for revenue of the latest year (December 2025 for the company and Schaeffler India, March 2026 for the others), RHP p.122 for margins (six months to June 2026 for the company and Schaeffler India, three months for the others). Private competitors named by the report, SEW-Eurodrive, Nord, Flender, Premium Transmission, PMP and Comer among others, are profiled without comparable margins (RHP p.184, RHP p.192).

Why customers choose the company, as the prospectus puts it: the Bonfiglioli brand, access to the group's seven R&D centres, the India R&D Centre, which the report calls the only Indian laboratory able to test yaw and pitch drives, and long relationships, with seven of the top ten customers engaged for more than ten years (RHP p.213, RHP p.214, RHP p.212). Of its 44 dealers, 36 are exclusive (RHP p.212). Against that, its EBITDA and PAT margins were the lowest among its listed peers in 2023 and 2024 (RHP p.49), and it owns no trademark or patent of its own (RHP p.49).

16Peers the company named

Peers named in the offer document: Elecon Engineering Company Limited, Shanthi Gears Limited, Schaeffler India Limited and Timken India Limited (RHP p.117).

Bonfiglioli Transmissions listed peers

Source: RHP p.117; peer P/E at NSE closing prices of September 28, 2026, converted from ₹ million. The prospectus gives the peers' average P/E as 51.61 times, between 31.63 and 63.39 (RHP p.115). Schaeffler India has about 4.8 times the company's revenue and Shanthi Gears about a quarter of it (our arithmetic, RHP p.117). Schaeffler India and Timken India are mainly bearing makers, and Elecon and Shanthi Gears mainly industrial gearbox makers (RHP p.117).

17Valuation at the issue price

Bonfiglioli Transmissions IPO valuation and P/E

At the upper band of ₹586, on 187,995,834 shares before and after the offer, as no new shares are issued (our arithmetic, RHP p.68):

Source: RHP p.68, RHP p.72, RHP p.114, RHP p.116; our arithmetic. At the lower band of ₹558 the market capitalisation is ₹10,490.2 crore and the P/E 44.1 times (our arithmetic, RHP p.68, RHP p.72).

Enterprise value at the upper band, less net cash of ₹160.4 crore at December 2025, is ₹10,856.2 crore, 29.3 times 2025 EBITDA of ₹370.8 crore (our arithmetic, RHP p.120). Against book value per share of ₹55.02 at June 2026, the price is 10.7 times (our arithmetic, RHP p.116).

The four peers the prospectus names traded at 31.63 to 63.39 times earnings on September 28, 2026, with a median of 55.7 times (our arithmetic, RHP p.117). At the upper band the issue is priced at 46.3 times 2025 profit, about 17% below that median and below every named peer except Elecon Engineering.

18Risks, in plain words

Bonfiglioli Transmissions IPO risks

Parent licence: the company makes most products under a licence from Bonfiglioli S.p.A. that runs one year at a time and can be ended by either side on three months' notice before December 31 (RHP p.30) → losing it would stop production of licensed products → the royalty is 6% of net sales of licensed products, ₹88.8 crore in 2025 (RHP p.258, RHP p.87).

Related parties: expenses with related parties were 32.71% of total expenses in the six months to June 2026 (RHP p.31) → prices set inside the group affect margins → the company states these deals are at arm's length (RHP p.31).

Suppliers: the top ten suppliers were 41.20% of 2025 purchases, the largest a group company at 15.18%, with no long-term contracts (RHP p.26) → a supply break delays output → imports were 28.90% of materials (RHP p.28).

Customers: the top ten customers were 36.60% of 2025 revenue from customers, without long-term binding agreements with all of them (RHP p.32) → losing a large buyer cuts revenue → the largest was 11.43% (RHP p.32).

Wind: yaw and pitch drives were 31.53% of 2025 revenue (RHP p.45) → a slowdown in turbine orders hits a third of sales → the report cites tender delays and price pressure (RHP p.184).

Tax: a GST show cause notice alleges ineligible input tax credit of ₹31.7 crore, which the company is challenging in the Madras High Court (RHP p.406) → an adverse outcome adds cost → tax claims against the company total ₹35.4 crore (RHP p.406).

Working capital: receivables were ₹532.5 crore at June 2026, and some customers get up to 240 days (RHP p.71, RHP p.51) → slow payment ties up cash → the cash conversion cycle rose from 80 days in 2023 to 94 in the six months to June 2026 (RHP p.120).

Issue-specific: the company receives nothing from the offer (RHP p.111); after it the parent keeps about 77% and control over dividends and the board (our arithmetic, RHP p.44).

19Litigation and regulatory matters

Cases against Bonfiglioli Transmissions and its promoters

There are no criminal proceedings, regulatory actions or material civil cases against the company or the promoters, and no SEBI or exchange action against the promoters (RHP p.406, RHP p.407). Contingent liabilities were ₹3.1 crore at June 30, 2026 (RHP p.51). Some filings for allotments made in 1999 to 2001 could not be traced at the Registrar of Companies (RHP p.100).

20Related-party transactions

Source: RHP p.78, RHP p.83, RHP p.84, RHP p.87, converted from ₹ million. In the six months to June 2026 the royalty was ₹50.5 crore and dividends ₹110.0 crore (RHP p.87).

What appeared or changed in the two years before filing: loans to Bonfiglioli Technology Space Private Limited began in 2024 after the services business was sold to it, and ₹54.1 crore was repaid in 2025 (RHP p.83); the buyback of 2024 paid ₹32.5 crore to Bonfiglioli S.p.A. and ₹39.6 crore to Bonfiglioli Vectron GmbH (RHP p.87); the gear components business was bought from Bonfiglioli Drive Solutions Private Limited in December 2025 (RHP p.257); and the Intercompany Service Agreement with Bonfiglioli S.p.A. dates from January 1, 2024, with fees at cost plus a 5% mark-up (RHP p.258).

The company plans to take over leased land at Talegaon from Bonfiglioli Drive Solutions Private Limited (RHP p.31).

21What the offer document does not say

Units sold and average price by product are not disclosed, so growth cannot be split into volume and price. Customers and suppliers are not named against their figures. The cost, capacity and timing of the planned Talegaon heavy-duty gearbox plant are not given. Why Bonfiglioli Technology Space Private Limited borrows from the company, and on what terms, is not set out in the pages read. The offer expenses and post-offer holdings are blank (RHP p.111, RHP p.109).

Some differences are recorded as document matters: the off-highway market share is 32.0% among non-captive players in the business chapter and 26.0% in the industry chapter (RHP p.211, RHP p.175); the top ten customers are 36.60% of 2025 revenue in one table and 35.58% in the customer-by-customer table (RHP p.32, RHP p.33); half-year revenue growth is 12.43% in the business chapter and 17.86% in the management discussion (RHP p.214, RHP p.374); the 2025 royalty is ₹88.8 crore in the related-party table and ₹89.6 crore in the management discussion (RHP p.87, RHP p.379); and headcount is 604 on-roll staff in one table and 987 in another (RHP p.47, RHP p.378).

22Five questions for management

1. How many units did the company deliver in each of 2023 to 2025, and at what average price in each vertical?
2. How is the 6% royalty base measured, and what share of 2025 revenue carried it?
3. What does the planned Talegaon heavy-duty gearbox plant cost, and when will it start?
4. On what terms, and for what purpose, were ₹44.2 crore lent to Bonfiglioli Technology Space Private Limited in 2025?
5. Why did inventories rise from ₹319.2 crore to ₹377.6 crore in the six months to June 2026?

24Draft to final: what changed

The lead managers, the registrar and the five promoters are the same in both documents, and in both the company receives no proceeds (DRHP p.24, RHP p.111).

1Sources and cited facts

This study was read from 1 document the company filed. The 176 figures it cites are listed under the document each came from, with the page and the sentence as printed.