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The company has declared acquisition of DYPC Inc., Seoul, South Korea — a globally recognised manufacturer of automated mechanical car parking systems with over two decades of operational history and deployments across the USA, UK, Mexico, Thailand, Iran, Uruguay, Egypt, Canada and other markets. This acquisition marks a significant step in L.T. Elevator’s strategic transition from a domestic elevator and car parking contractor into a global automated parking technology company.
The company claims that DYPC’s technology is directly complementary to Park Smart’s existing automated parking business in India, and the acquisition provides L.T. Elevator with proprietary Korean parking technology, international IP including 12 patents, and an established global client base — significantly enhancing the Company’s capability to bid for and execute large-scale, technically complex car parking projects in India.
The company has stated that home elevator business has crossed ₹100 crore in annualised run-rate (ARR) order bookings . As the Company transitions to the new facility in FY27, it already has confirmed orders in hand for the new facility, providing strong revenue visibility for the year ahead.
With the DYPC acquisition, the commissioning of the integrated manufacturing facility in Q4 FY27, and the continued momentum in both the home elevator and car parking segments, the Company is well-positioned to sustain the strong growth trajectory of the business. The management expects FY28 growth to be maintained at a pace comparable to FY27 — supported by DYPC’s international revenues, expanded domestic manufacturing capacity, the ₹100 crore+ ARR home elevator business, and a deepening order book across all segments.
LTElevator.pdf (1.0 MB)
Though the declaration look good on face of it, there are certain issues we must keep in mind. Till date the Management has not declared the share swap ratio with Richardo. Despite managements statement earlier, no application has been initiated till date for Richardo mereger in NCLT. Though the company raised some capital through preferential issue, cash flow position of the company must improve. Though inorganic growth can look good, it is equally risky.
Disclosure: Invested and Biased.
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Any idea on the acquisition cost in absolute and relative terms like p/b, p/s etc. VS growth, roce etc?
Good video to watch on Otis(largest elevator company in the world)- https://youtu.be/fY4eelX7HDM?si=hFGZM524unAAk5-h
Key points- they installed and maintain the elevators in empire state building and the eiffel tower, services contributes 90% to their profits, growth has slowed globally ad so, they are focusing on maintenace revenue more. Something interesting that was said was since re has slowed down, so has elevator installation in china, europe and us(might pick up if multi storey building become popular) but India does have potential
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Promoter shareholding has dropped to roughly 56% from 63% June end. However, seems more equity raise is under plans. Not clear as to what the company’s plans are
f8ec1b79-e54e-4fd5-98d9-32ef8d268bde.pdf (337.0 KB)
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They need money for DYPC acquisition declared a few days ago. Too many acquisitions, funded by equity dilution. Needs closer examination.
@sanketkulkarni1987 This is just to get approval to allocate equity for Ricardo acquisition which they did announce earlier. They aren’t raising any money.
Regards,
Raj
Disc:Invested.
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Very good deep dive by @Zen_Nivesh team & Ankit Kanodia,
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LT Elevator has announced that it has dropped the merger plan, and instead buying all shares of Richardo through share swap. 4.61 lakhs shares are being issued to Richardo shareholders. It is around 2.5% dilution- okay for whatever we know about the accounts of Richardo. It will make Richardo a 100% subsidiary of LT, and they can merge anytime in future. I think it is a good deal.
LTElevator.pdf (423.2 KB)
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