Bonfiglioli IPO Valuation: 46x P/E, ₹759 Crore Anchor Book as Issue Opens October 15

The Bonfiglioli IPO valuation is the real question as the ₹2,534 crore issue opens for bidding on Thursday, October 15, 2026. At the top of the ₹558–586 price band, you’re paying about 46 times last year’s earnings for the Indian arm of Italy’s Bonfiglioli S.p.A. A day before opening, the company raised ₹759.26 crore from anchor investors at ₹586 a share, PTI reported. Our earlier Bonfiglioli Transmissions IPO review covered the dates and lot size. Here we go a layer deeper, into the numbers behind the price: growth, margins, cash, the anchor book and how the multiple stacks up against listed peers.

Bonfiglioli IPO valuation: the issue in brief

This is a pure offer for sale (OFS) of 4.32 crore shares by the promoter, Bonfiglioli S.p.A. There’s no fresh issue. The company gets nothing; every rupee goes to the selling parent, according to The Economic Times (PTI). The main terms, as reported by CNBC-TV18 and Moneycontrol:

• Issue size: up to ₹2,533.66 crore (rounded to ₹2,534 crore in most reports)
• Price band: ₹558 to ₹586 per share, face value ₹10
• Lot size: 25 shares, so one lot costs ₹14,650 at the upper end
• Retail maximum: 325 shares (13 lots), or ₹1,90,450 at the upper end
• Bidding window: October 15 to October 19, 2026; allotment expected October 21, refunds and demat credit October 22, listing on BSE and NSE October 23
• Market capitalisation: about ₹11,016.56 crore at the upper end, unchanged before and after the issue since no new shares are created
• Lead managers: Axis Capital, BNP Paribas, ICICI Securities and Jefferies India

Per CNBC-TV18, the book is split 50% for qualified institutional buyers (QIBs, including anchors), 35% for retail investors and 15% for non-institutional investors (HNIs). Once the sale is done, the promoter’s stake drops from 100% to 77%. The arithmetic checks out: 4.32 crore shares sold out of about 18.80 crore outstanding is roughly 23% of the company.

What Bonfiglioli Transmissions makes

Bonfiglioli Transmissions makes mechanical and electro-mechanical power transmission products, meaning gearmotors, gearboxes and drive systems that machine builders (OEMs) and end users fit into their equipment. ET says the Bonfiglioli brand goes back nearly 70 years globally, and the group has been in India for more than 25 years. Its first plant was in Chennai. The Pune facility serves a long list of industries, including packaging, food, steel, cement, pharma, material handling, textiles, power generation, sugar, paper and water treatment, as CNBC-TV18 noted in its IPO report.

The company reports three verticals. Going by the key performance indicators in the “Basis for Offer Price” section of the red herring prospectus (published by lead manager Axis Capital), the revenue mix for calendar year 2025 looked like this (its financial year ends on December 31):

• Industry and automation solutions: 40.95% of revenue from operations
• Wind industry: 31.53%
• Off-highway mobility: 25.18%
• Others (such as component sales to vendors): 2.34%

The mix shifted in the six months to June 2026. Against the same half of 2025, off-highway mobility climbed to 28.31% from 24.46% and wind slipped to 27.36% from 32.20%, while industry and automation stood at 42.53%. Customers outside India brought in 27.51% of revenue from customers in 2025 and 29.96% in the first half of 2026. In other words, close to 30% of sales now comes from abroad.

Financials: steady sales, quicker profit growth

Every figure below is a restated number from the prospectus’s KPI table, converted from ₹ million to ₹ crore. The growth rates are our own calculations from those figures.

Revenue grew 9.9% in 2024 and 8.6% in 2025. That’s decent for a capital goods company, nothing more. Profit tells the better story. Profit after tax rose 30.6% in 2024 and 24.2% in 2025, because the EBITDA margin (operating profit before other income, as a share of revenue) widened by nearly 4 percentage points over two years, from 14.45% to 18.41%.

In the first half of 2026, both lines sped up. Revenue was 17.9% above the first half of 2025, profit after tax was 29.2% higher, and the margin rose to 19.78%. The prospectus marks the half-year numbers as not annualised, so compare them only with the same half of the year before.

The case for Bonfiglioli rests less on fast sales growth and more on margins: profit has grown roughly three times as fast as revenue as operating margin climbed from about 14% to nearly 20%.

Balance sheet and returns

Net debt shows up as a negative number in every period in the prospectus, which simply means the company holds more cash than it owes. Net cash was ₹160.38 crore at the end of December 2025 and ₹139.38 crore at the end of June 2026. Return on equity came in at 25.66% and return on capital employed at 34.05% in 2025, up from 19.21% and 24.53% respectively in 2023.

Working capital is where we’d keep an eye. The cash conversion cycle, which is how many days money stays tied up in inventory and receivables after netting off payables, stretched from 80 days in 2023 to 90 days in 2025 and 94 days in the first half of 2026. Receivable days went up to 94 in 2025 from 80 in 2024. That’s not unusual for a business selling to wind turbine makers and machine builders, but if it stretches much further, it starts to eat into cash generation.

Net asset value per share was ₹55.02 at June 30, 2026, adjusted for the 1:2 bonus issue (one bonus share for every two held) the board allotted on January 25, 2026. At ₹586, the price works out to about 10.7 times book value by our calculation.

How the price stacks up against listed peers

The prospectus works out the price-to-earnings (P/E) ratio on 2025 diluted earnings per share of ₹12.65. That gives 44.11 times at the ₹558 floor and 46.32 times at the ₹586 cap. The four listed peers named in the document traded at an average P/E of 51.61 times, using NSE closing prices on September 28, 2026:

Peer revenue is for the year to March 31, 2026 for Elecon, Shanthi Gears and Timken, and for the year to December 31, 2025 for Schaeffler, as the prospectus notes. Return on net worth (RoNW) is profit divided by year-end net worth.

So on these numbers, the issue is priced below the peer average and below three of the four peers, while posting the best return on net worth in the group. It is clearly dearer than Elecon Engineering, which the prospectus calls one of Asia’s largest industrial gearbox makers and which traded at about 32 times. If you think Elecon is the right yardstick, the price looks full. If you’d rather compare it with Schaeffler India and Timken India, which the prospectus’s peer profiles link to their global groups’ engineering and supply networks, it looks more reasonable.

A couple of simpler checks, all our own calculations: the ₹11,016.56 crore market cap is about 5.5 times 2025 revenue and about 29.7 times 2025 EBITDA (excluding other income). Subtracting net cash of ₹160.38 crore barely moves that, because the cash is small next to the company’s value.

The anchor book: who bought on October 14

Bonfiglioli allotted 1.30 crore shares to anchor investors at ₹586 each, the top of the band, raising ₹759.26 crore, per PTI. By our calculation, that’s about 30% of the total issue and roughly 60% of the 2.15 crore shares set aside for QIBs. Domestic buyers included SBI Mutual Fund, HDFC Mutual Fund, ICICI Prudential Mutual Fund, Nippon India Mutual Fund, Axis Mutual Fund, Aditya Birla Sun Life Mutual Fund and Mirae Asset Mutual Fund. On the global side were BlackRock, Goldman Sachs Asset Management, Allianz Global Investors and Amundi, along with the Abu Dhabi Investment Authority and Canada’s PSP Investments.

A full anchor book at the upper end tells you institutions were happy to pay the top price. It doesn’t promise heavy subscription or a listing premium. Anchor shares are locked in for a while after listing; our guide to anchor investors in an IPO explains how that works and what retail investors can, and can’t, read into an anchor list.

Grey market premium: handle with care

Bonfiglioli shares were quoting a grey market premium of around 31% as of October 14, according to tracking platform InvestorGain, as cited by Moneycontrol. Remember that the grey market is unofficial and unregulated. Its quotes come from informal dealer trades, they can swing wildly while bidding is open, and they guarantee no listing gain. Take it as one sentiment signal, not a forecast.

An offer for sale changes the question investors should ask: not what the company will do with new money, because it gets none, but whether today’s earnings and margins justify paying the parent’s asking price.

Risks and open questions

• No money for the company. The whole issue is an OFS, so there’s no new capital for expansion or paying down debt. You’re buying shares from the parent, and existing earnings have to justify the price.
• Wind exposure. Wind turbine customers made up 31.53% of 2025 revenue. In the first half of 2026 that share was 27.36%, down from 32.20% a year earlier, which shows how lumpy this segment can be.
• Working capital creep. The cash conversion cycle has gone from 80 days to 94 days since 2023. Faster growth paired with longer receivables can lock up cash.
• The price already assumes growth. At about 46 times 2025 earnings, the stock needs the margin gains and faster growth of the first half of 2026 to keep coming. A slowdown in industrial capex or wind orders would make that multiple harder to defend.
• Parent control. The Italian parent will still own about 77% after the sale, so the big decisions stay with the promoter.

Is the Bonfiglioli price worth paying?

Bonfiglioli Transmissions arrives with a clean balance sheet, rising margins and returns that top its peer group, plus a full anchor book from domestic and global institutions. The trade-off is the price. At the upper end, you pay roughly 46 times last year’s profit for a business whose sales grew in single digits in 2024 and 2025 before picking up in the first half of 2026.

Long-term investors should ask two things: will the margin expansion of the last two years last, and can first-half growth of nearly 18% hold? Listing-day traders will care more about the grey market and the subscription numbers over the next three days, though both can turn quickly. Retail investors can bid for a single lot of 25 shares for ₹14,650 through ASBA or a UPI mandate, and should approve any UPI mandate before the cut-off on October 19.

For more on sizing up new issues, read our guide to IPO investing in India, and follow the day’s moves on our Stock Market Today India page.

This article is for information only and is not investment advice. Read the red herring prospectus and consult a SEBI-registered adviser before investing.