Admach Systems

• Admach Systems is coming out with an initial public offering (IPO) of 17,82,600 shares in a price band of Rs 227-239 per equity share. 
• The issue will open on December 23, 2025 and will close on December 26, 2025.
• The shares will be listed on SME Platform of BSE.
• The face value of the share is Rs 10 and is priced 22.70 of its face value on the lower side and 23.90 times on the higher side.
• Book running lead manager to the issue is Aftertrade Broking.
• Compliance Officer for the issue is Aniruddha Shrikant Deshmukh.

Profile of the company

Admach Systems is designed and build machines for the Indian and global engineering industry. It offers customized solutions tailored to meet the unique needs of various industries majorly Steel Industry, Automobile Industry, Food Industry, Tooling Industry and other Engineering Industries. The company’s areas of specialization are special purpose machines, automation, assembly machines, packaging machines, product design and robotic material handling systems. It manufactures, exports and supplies a range of customized special purpose machines.

Additionally, it provides comprehensive after-sales support, including maintenance, repair, and technical services, to ensure its products perform optimally throughout their lifecycle. It exclusively provides services for the machines manufactured and supplied by the company, both domestically and internationally. Domestic service charges are determined at the time of order finalization or as per mutually agreed terms with the customer.

The company is committed to delivering innovative, high-quality products through a strong focus on research, design, and engineering. Maintaining strict quality control is central to its operations, ensuring the reliability, durability, and safety of its products. It efficiently manages complex supply chains to source essential materials and components for manufacturing. As of March 31, 2025, more than 13 customers have been associated with it for longer than 15 years. The company has served more than 34 customers in the last one year.

Proceed is being used for:

• Funding of capital expenditure requirements of the company towards purchase of new machinery and installation cost thereon
• Funding working capital requirements of the company
• General corporate purposes

Industry Overview

India’s engineering sector stands as the backbone of its industrial prowess, playing a critical role across industries such as construction, infrastructure, consumer goods, and manufacturing. Accounting for 27% of India's total factories and representing 63% of overall foreign collaborations, the sector forms a vital part of the country's economic framework. Driven by capacity expansion in industries like infrastructure, electricity, mining, oil and gas, and automobiles, the demand for engineering services continues to surge. India's competitive advantages-cost-effective manufacturing, deep market knowledge, technological expertise, and innovation capabilities-have propelled its engineering sector to remarkable growth in recent years. Strategic government initiatives have further amplified this growth, making engineering a crucial pillar of India’s economy. Engineering goods exports reached Rs 7,61,343 crore ($87.22 billion) in FY25 (until December), and $109.32 billion in FY24, with key markets including the US, Europe, and the UAE.

The Machine and Equipment Manufacturing Industry plays a crucial role in driving economic growth by producing essential machinery and equipment for various sectors. This industry supports advancements in technology and infrastructure, contributing to enhanced productivity and competitiveness. By fostering innovation and skill development, it ensures sustainable progress and resilience in the face of evolving market demands. To accelerate the advancement of the Machine and Equipment Manufacturing Industry, Development Councils have been reconstituted. These councils bring together machinery and equipment manufacturers, users, and policymakers from government departments to address various issues and make decisions aimed at sustainable growth. Additionally, the Scheme for Enhancement in the Competitiveness of the Capital Goods Sector has promoted technology upgrades, skill development, and the expansion of modern manufacturing capacities to boost industry competitiveness.

The Special Purpose Machines Market focuses on the production of customised machinery designed for specific industrial applications and processes. These machines are not included in the standard manufacturing agenda and are not available on a ready basis. Hence, this market is driven by the demand for tailored solutions that enhance efficiency and precision in manufacturing. Most of the special purpose machines are focused on automated trimming or inspection and assembling operations. As industries seek to optimise their operations, the market for these specialised machines continues to grow, supporting technological advancement and competitive edge. Special purpose machines designed to handle high-volume production maintain consistent quality, reducing human error and downtime. Their ability to perform specific, repetitive tasks at high speeds enhances overall productivity and meets the industry's demand for large-scale output. Furthermore, they contribute to cost savings by minimising labour requirements and operational inefficiencies. 

Pros and strengths

Diversified customer base: The company sells its products both in the domestic as well as international markets. In the domestic market, it sells its products to the SPEMS (Special Purpose equipment and machines), manufacturers and it supplies with installation of its products in the international market. The company has been engaged in exports of Special Purpose Machinery. The company has successfully expanded its global presence, exporting to several countries, including China, Italy, South Korea, Dubai, and Russia. Currently, the company has orders in hand are worth Rs 4,422.118 lakh.

Quality check: The company has developed quality control processes for inspecting the raw materials as well as the final products. The raw materials undergo a quality check and for this purpose it has even implemented internal procedures for procurement of the raw material as the quality of the final product is dependent on them. The company’s Units have dedicated personnel responsible for monitoring the parameters of equipment, strength of materials, reporting any irregularities in the manufacturing process and making adjustments accordingly. These multi-level quality checks ensure that it consistently provides good quality products which further enhances its brand value. The company is committed to maintain quality and at all steps from procurement till dispatch.

Experienced Promoters supported by a management and execution team: The company’s promoters have been instrumental in guiding, developing, and expanding the company. Under their leadership, it has experienced significant growth in the engineering sector since its inception. Effective leadership arises from teamwork, fostering consensus around innovative ideas and practices that enhance its competitive advantage in machine building. The company’s Promoters, Ajay Chamanlal Longani and Mahesh Chamanlal Longani, who also serve on its Board of Directors, have a solid background in engineering and manufacturing. They possess over 20 years of experience in the machine tool industry, which significantly enhances its manufacturing capabilities. Consequently, the company is guided by these promoters, who bring extensive expertise in machine design, operational efficiency, and project management within the engineering sector.

Risks and concerns

Reliance on a limited product portfolio: The company is significantly dependent on the sale of its products namely, Steel Machines, Nondestructive testing equipment and Packaging machine. The company’s aggregate revenue from sale of Steel Machines accounted for 76.11%, 88.48%, 55.13% and 33.66% of its revenue from operations for the period ended June 30,2025 and Fiscal 2025, 2024 and 2023 respectively. Failure to anticipate and adapt to changing consumer preferences or maintain product quality could harm demand for its products, weaken brand loyalty, and negatively affect its business, financial results, and cash flow.

Geographic concentration of revenue in Maharashtra: The company derive its revenue from the domestic market and substantial portion of revenue from the region of Maharashtra. Its business is geographically concentrated in certain regions especially Maharashtra, which increases its vulnerability to adverse developments in those areas, such as heightened competition, economic shifts, or demographic changes. Any adverse developments affecting its operations in this region, could have an adverse impact on its business, financial condition, results of operations and cash flows.

Revenue concentration and absence of long-term customer commitments: The company’s top ten customers have contributed 99.94%,95.03%, 97.70% & 98.60% of its revenues for the period ended June 30,2025 and for the year ended March 31, 2025, March 31, 2024, March 31, 2023 respectively based on Restated Financial Statements. Any loss of business from one or more of them may adversely affect its revenues and profitability. Further, it does not have any long-term commitments from customers and any failure to continue its existing arrangements could adversely affect its business and results of operations. The substantial portion of its revenue is currently significantly dependent on its top ten customers. Any loss of business from one or more of them may adversely affect its revenues and profitability. 

Outlook

Admach Systems is engaged in designing, manufacturing, exporting, and supplying customised special purpose machines and automation systems for the Indian and global engineering industry. Its offerings primarily cater to the steel, automobile, food, tooling, and other engineering industries. The company specializes in special purpose machines, robotic material handling systems, automation, assembly machines, packaging machines, and product design. On the concern side, the company is significantly dependent on the sale of its products namely, Steel Machines, Nondestructive testing equipment and Packaging machine. Failure to anticipate and adapt to changing consumer preferences or maintain product quality could harm demand for its products, weaken brand loyalty, and negatively affect its business, financial results, and cash flow. Moreover, the company derive its revenue from the domestic market and substantial portion of revenue from the region of Maharashtra. Any adverse developments affecting its operations in this region, could have an adverse impact on its business, financial condition, results of operations and cash flows.

The company is coming out with a maiden IPO of 17,82,600 equity shares of face value of Rs 10 each. The issue has been offered in a price band of Rs 227-239 per equity share. The aggregate size of the offer is around Rs 40.47 crore to Rs 42.60 crore based on lower and upper price band respectively. On performance front, during the financial year 2024-25 the net revenue from operation of the company increased to Rs 5,335.82 lakh as against Rs 1,968.24 lakh in the Financial Year 2023-24 representing an increase of 171.10%. The increase in revenue from operations was due to increase in volume of domestic as well as export business of the company. Moreover, the company’s profit after tax for the year 2024-25 increase by 82.14% to Rs 609.81 lakh from net profit of Rs 334.80 lakh in financial year 2023-24.

The company's strategy is attentive towards introducing new product designs to cater to the requirements of its customers as well as garnering the attention of new customers. This helps in strengthening the relationship with the existing customer network through a wide range of products while also onboarding new customers from untapped geographies. Identifying and developing new products and designs is a continuous exercise that its management team engages into as there is an immense demand in the global markets for unique designs, good quality and competitively priced products. Further, the company’s ability to enter into new customer relationships has been critical to its growth. Certain of its customers are part of large groups with operations across geographies and legal entities. It also intends to continue to leverage its products and its long-term relationships and credentials with its existing customers and referrals from such customers to further develop and strengthen its customer base. There are certain geographies including India and other countries where it is underpenetrated on automotive components and will strive to improve its market share in such geographies.