Dhoot Transmission’s Rs. 3,066.89 crore initial public offering (IPO) opened for subscription on August 10, attracting attention from investors given a strong grey market premium and the company’s growing exposure to India’s electric vehicle industry.
The IPO will close on August 12, with a price band of Rs. 829-Rs. 871 per share. Ahead of the public issue, Dhoot Transmission raised Rs. 918.27 crore from 72 anchor investors at Rs. 871 per share.
Dhoot Transmission shares were commanding a grey market premium (GMP) of around Rs. 259. Based on the upper price band of Rs. 871, this implies a potential listing price of approximately Rs. 1,130 and an indicative gain of nearly 30%.
However, GMP operates in an unofficial market and can fluctuate substantially before listing. Investors should therefore not consider the premium a guaranteed listing return.
Dhoot Transmission manufactures wiring harnesses, sensors, switches, connectors, electronic controllers and battery-related components for automotive manufacturers.
The company held around 41% market share in wiring harnesses for two- and three-wheelers and nearly 70% share in electric two- and three-wheelers in FY26, according to the IPO details.
Importantly, approximately 95% of its automotive portfolio is either EV-focused or powertrain-neutral. The company is also expanding into battery assemblies, onboard chargers, DC-DC converters and charging guns.
Dhoot Transmission reported total income of Rs. 4,563.70 crore, up approximately 31% from Rs. 3,472.24 crore in FY25. Profit after tax increased around 12% to Rs. 396.84 crore, compared with Rs. 353.89 crore previously.
From the IPO proceeds, Rs. 464.80 crore is planned for repayment or prepayment of borrowings, while Rs. 301.77 crore will be invested in subsidiaries for debt reduction. Another Rs. 150 crore will finance new wiring harness facilities in Haryana and Tamil Nadu.
"Dhoot Transmission's public issue arrives with strong backing from global investors and a robust grey market premium signaling nearly 30% listing gains," said Abhishek Bhilwaria, Partner at BhilwariaFinserv.
He added, "As a critical component supplier deeply integrated into India's expanding electric vehicle supply chain, the company offers a compelling mix of short-term momentum and long-term structural upside."
The combination of strong market share, rising revenue, EV exposure and debt reduction supports the long-term investment case. AnandRathi has given the IPO a "Subscribe for Long Term" rating, while Ventura Securities has also recommended subscribing.
For listing-gain investors, the 30% indicative GMP is encouraging but remains speculative. Long-term investors have a stronger fundamental argument, although valuation, customer concentration and execution risks should still be considered before bidding.