Castrol India Ltd. Share Price

LAPL Automotive

• LAPL Automotive is coming out with an initial public offering (IPO) of 34,46,400 shares in a price band of Rs 88-94 per equity share.
• The issue will open for subscription on August 06, 2026 and will close on August 10, 2026.
• The shares will be listed on SME Platform of BSE.
• The face value of the share is Rs 10 and is priced 8.80 times of its face value on the lower side and 9.40 times on the higher side.
• Book running lead manager to the issue is GYR Capital Advisors.
• Compliance officer for the issue is Shubhangi Madhukar Rajput.

Profile of the company

The company is an integrated automotive components manufacturer operating across ODM (Original Design Manufacturing) and OBM (Original Brand Manufacturing) models, with a diversified product portfolio spanning automotive lighting systems, mirrors, and plastic moulded components. The company caters to automobile OEMs across passenger vehicles, commercial vehicles, two wheelers, and electric mobility segments. With a diversified product portfolio, the company caters to the products of tail lamps, front and rear indicators, reflex reflectors, head lamp, stop lamp, position lamp, reverse lamp and roof lamp, etc., the motor segments covers starter motor, wiper motor, rotors etc. and other components and accessories segment such as hood, stators, small BLDC fans and many more for various spectrum of vehicles.

It is an IATF 16949:2016 certified company, providing customized lighting solutions for various vehicle segments. Its lighting products are designed using technologies such as light-emitting diode (LED). The Company has an in-house testing facility for quality testing and assurance, where products undergo various environmental testing parameters which includes humidity, tensile strength, heat, freeze, flammability, voltage control tests, endurance and drop test, etc. to cater AIS (Automotive Indian Standards). Some of its products are also certified by other approved certifying agencies such as CIRT, ICAT, VRDEA and ARAI for safety standards and quality assurance as required by few of its customers prior to its supply. It improves quality control, product reliability, faster testing, quicker product development, customization and increased customer satisfaction.

The company operates as an ODM and OBM under its proprietary brand, ‘LAPL.’ Through these complementary business verticals, it leverages its design expertise, manufacturing capabilities, and market understanding to serve a diverse customer base while strengthening its brand presence.

Proceed is being used for:

• Funding Capital Expenditure requirements towards setting-up a new manufacturing facility at Aurangabad, Maharashtra
• Paying or repaying, in full or in part of certain outstanding secured borrowings availed by the company 
• Meeting general corporate purposes

Industry overview

India has emerged as the fastest-growing economy in the world in recent years. Rising incomes, higher infrastructure spending, and supportive manufacturing incentives have together accelerated the automobile sector, making it a critical pillar of India’s growth story. The two-wheeler segment, driven largely by the expanding middle class, continues to dominate the market, with sales reaching 19.6 million units in FY25. This surge in demand has also encouraged the expansion of original equipment and auto component manufacturers, helping India build strong expertise in this space and enhancing global demand for Indian vehicles and components.

India’s auto components industry has significantly expanded its market share, driven by rising automobile demand from the growing middle class and strong global exports. The sector has attracted both Indian and international players and is broadly classified into organised and unorganised segments. While the unorganised sector primarily caters to the aftermarket with low-value items, the organised sector focuses on supplying high-value precision instruments to Original Equipment Manufacturers (OEMs). India’s automobile production further highlights the scale of demand that supports the component industry. In FY26 (AprilSeptember), domestic sales stood at 1,02,36,639 units for two-wheelers, 20,51,082 units for passenger vehicles, 4,63,502 units for commercial vehicles, and 3,94,450 units for three-wheelers. In FY26 (April-September), the total production of Passenger Vehicles, Commercial Vehicles, Three Wheelers, Two Wheelers and Quadricycle was 1,65,34,997 units.

The rapidly globalising world is creating new opportunities for the transportation industry, particularly with the shift towards electric, electronic, and hybrid vehicles that are seen as more efficient, safe, and reliable. Over the next decade, this transition will open new verticals for auto component manufacturers, supported by strong government policy measures. The Indian government has already introduced production incentives and is investing heavily in electric vehicle (EV) infrastructure, including the exemption of customs duties on capital goods and machinery used for producing lithium-ion cells.

Pros and strengths

Integrated ODM and OBM business model: The company’s dual presence as an ODM and OBM provides a strategic advantage by enabling diversified revenue streams and flexibility in addressing varied customer requirements. While the ODM vertical allows it to partner closely with automotive OEMs and component manufacturers, the OBM vertical under its proprietary brand ‘LAPL’ supports brand building and direct market engagement.

Strong in-house design, engineering and manufacturing capabilities: The company possesses robust in-house capabilities spanning product design, engineering, tooling, prototyping, and manufacturing, which allow it to offer end-to-end solutions. This integrated approach reduces development timelines, enhances cost efficiency, and ensures consistent quality across product offerings.

Well positioned to capitalize on the growing EV opportunity: The rapid growth of the electric vehicle market presents a significant opportunity for the company. Its advanced LED lighting solutions are designed to be platform-agnostic, enabling seamless integration across both internal combustion engine (ICE) and EV platforms. This technological versatility allows us to address evolving customer requirements while supporting the industry's transition toward sustainable mobility. It is actively strengthening its engagement with leading EV OEMs and continuously expanding its innovative product portfolio to align with emerging mobility trends, reinforcing its position as a preferred lighting solutions partner for the next generation of vehicles.

Risks and concerns

Significant revenue concentration in Maharashtra: The company generates its major portion of sales from its operations from Maharashtrian regions. Revenue from customers located in Maharashtra contributed 86.10%, 82.90%, and 82.90% of the company's revenue from operations for the financial years ended March 31, 2026, 2025, and 2024, respectively. Any adverse developments in Maharashtra or western region, including but not limited to regional economic slowdown, disruptions in transportation and logistics, natural calamities, changes in state-level regulations or policies, labour unrest, or other unforeseen events affecting the region, may disrupt its manufacturing activities or impact demand from its customers. Such disruptions could lead to production delays, supply chain constraints, increased operational costs or reduced order inflows.

Dependence on top 10 customers for substantial portion of revenue: The company depends on its top 10 customers for a substantial portion of its total revenue from operations. The company’s top ten customers contributed 95.49%, 96.40%, and 96.93% of its total revenue from operations for the Fiscal 2026, Fiscal 2025 and Fiscal 2024, respectively.  The loss of its any of its top 10 customers for any reason (including due to loss of, or failure of its customers to win orders; limitation to meet any change in quality specification, change in technology, disputes with a customer, adverse changes in the financial condition of its customers, such as possible bankruptcy or liquidation or other financial hardship) could have a material adverse effect on its business, results of operations and financial condition. Additionally, it does not have any formal long-term arrangements with any of its customers which obliges them to maintain their business with the company, relying instead on purchase orders to dictate sales terms and volumes.

Dependence on limited number of suppliers for raw materials: The company is primarily dependent upon few key suppliers within limited geographical location for procurement of raw materials and it does not have any long-term agreements with such suppliers. Purchases made from its top 10 suppliers for the financial year ended March 31, 2026, 2025 and 2024 Rs 4,178.40 lakh, Rs 2,752.00 lakh and Rs 2,470.52 lakh representing 59.66%, 56.17%, and 56.96% of its total purchases. Any disruption in the supply of the raw materials or fluctuations in their prices could have a material adverse effect on its business operations and financial conditions.

Outlook

LAPL Automotive is engaged in the business of manufacturing automobile parts and ancillaries, including the design and production of motors, lighting systems, and mirrors for two-wheelers, three-wheelers, four-wheelers, buses, and utility vehicles. In addition, the Company provides design, testing, and certification support services. On the concern side, its business operations require significant working capital to support procurement of raw materials, manufacturing processes, project implementation cycles, inventory maintenance and receivables management. In addition, certain projects undertaken by it may involve relatively long implementation and payment realisation periods, which may result in a gap between the timing of its expenditures and the receipt of payments from customers. As a result, its operations are dependent on the availability of adequate working capital facilities and other forms of financing.

The company is coming out with a maiden IPO of 34,46,400 equity shares of face value of Rs 10 each. The issue has been offered in a price band of Rs 88-94 per equity share. The aggregate size of the offer is around Rs 30.33 crore to Rs 32.40 crore based on lower and upper price band respectively. On performance front, the total income of the company for fiscal year 2026 was Rs 9,431.54 lakh against Rs 6,707.28 lakh of total income for Fiscal year 2025 with an increase of 40.62% in total income. Profit after tax for the Fiscal 2026 were at Rs 862.69 lakh against profit after tax of Rs 503.45 lakh in fiscal 2025, an increase of 71.36%.

Meanwhile, the company intends to deepen relationships with existing OEM customers by transitioning from part-wise supply to platform level engagement. Instead of entering at the post-design sourcing stage, the company aims to participate during the vehicle development phase through co-development initiatives, integrated assemblies (lighting, mirrors and motors), early design validation including DFMEA support, and faster PPAP readiness cycles. This strategy is expected to enhance switching costs, enable multiyear platform lock-ins and improve revenue visibility, thereby positioning the company as a development partner rather than a transactional supplier.