WOL 3D India
- WOL 3D India is coming out with an initial public offering (IPO) of 17,04,000 equity shares in a price band Rs 142-150 per equity share.
- The issue will open on September 23, 2024 and will close on September 25, 2024.
- The shares will be listed on SME Platform of NSE.
- The face value of the share is Rs 10 and is priced 14.20 times of its face value on the lower side and 15.00 times on the higher side.
- Book running lead manager to the issue is HEM Securities.
- Compliance Officer for the issue is Nayna Pratik Lunker.
Profile of the company
WOL 3D India is engaged in the business of providing 3D Printing solutions enabling easier prototyping finding its application in various sectors like manufacturing, education, engineering, architecture, interior designing, fashion designing, product designing, medical, dental etc. It is a 3D Printing Solutions Company aimed at bridging gap between ideation and manufacturing by providing high quality and cost-effective 3D Printing solutions with cutting edge technology. The company’s portfolio of offerings includes (i) Hardwares like: 3D printers, 3D Scanners, Laser Engravers and 3D pens (ii) Consumables like: 3D Filaments, 3D Resins, (iii) 3D Prototyping services and (iv) Other services. 3D Printing is used for additive manufacturing (AM) which is a computer-controlled process that creates three dimensional objects by depositing materials, usually in layers. 3D-printing allows materials to be created without joints and with minimal post-processing. Multiple materials can be used during this process, which makes it easy to create new products with minimal waste and lower materials costs.
Ventured into the innovative business since 2019, the company’s product portfolio includes wide range of 3D Printers offering various solutions comprising of: Desktop 3D Printer, Industrial 3D Printer, Resin 3D Printer, DIY 3D Printer, Multi Color 3D Printer, etc. Furthermore, its product portfolio includes 3D Pens which are used to draw three-dimensional objects. These 3D Pens are available in safe, multi-color, easy to operate, plug & play, LED Screen in 8 designs out of which three are patented by the company. This was a new milestone in 2023 when the company received Patent registration for the design of its 3D Pens. Currently, it is the distributors for International 3D Printer brands like Flashforge, Creality, Bambu lab, Phrozen and Elegoo. The company largely imports these printers and it has got trademark registrations in India for some of the popular 3D Printer brands like: Flashforge, Fila-tech, Wol3D, Qidi Technology, X-smart 4.0s, I Tech 4.0s, itouch3D, Hismart4.0s, Creality 3D, Creality and Pixel 3D.
Expanding its operations towards back integration, it also manufactures 3D filaments used in additive manufacturing process. It manufactures these thermoplastic filaments used in 3D printers made from Acrylonitrile Butadiene Styrene (ABS) and Polylactic Acid (PLA) plastic. Its range of products are offered at different pricing points to meet diverse customer requirements. Additionally, it designs, develops, manufactures, and sells a wide range of aesthetic products made out of 3D Printing technology. It also provides Prototyping services using FDM, SLA and SLS technology. Its prototyping solutions include services through (i) CAD/CAM moddel, (ii) Reverse Engineering and (iii) Vacuum casting.
Proceed is being used for:
- Repayment in full or in part, of certain of its outstanding borrowings
- Meeting working capital requirements
- General corporate purpose
Industry Overview
Additive Manufacturing (AM), also known as 3D printing, is the process of manufacturing an object, layer by layer. It differs from the traditional subtractive manufacturing techniques involving cutting large blocks of material to form the desired object. AM has the potential to transform manufacturing due to design freedom, shape optimisation potential, reduced time-to-market, ease of making changes and low capex requirements. Furthermore, AM plays a key role in bringing about Industrial Revolution 4.0. India has an excellent opportunity as the world begins to adopt AM techniques. Additive manufacturing development and adoption can help India in become a leading manufacturing hub. To achieve this, the Ministry of Electronics and Information Technology (MeitY) formulated the ‘National Strategy on Additive Manufacturing’. The strategy aims to increase India’s share in global AM to 5% in the next three years. Meity estimates that AM can add $1 billion to India’s GDP by that time.
AM is among the most revolutionary scientific innovations & discoveries. It enables access to cost-effective and flexible manufacturing and designing techniques. It is a boon for small businesses as they can adapt to the changing demand environment due to simplified supply chains and grow faster through innovation and product differentiation. The National Strategy on AM is thus crucial in helping the Indian industry remain competitive. The strategy aims to create an ecosystem comprising 100 start-ups, 1 lakh new skilled manpower, 10 AM sectors and 50 AM products and technologies. It also aims to create an ecosystem for adopting the latest developments. The PPP model will help procure the best of private and public resources. India is currently a nascent market for AM and, given the strategy, has immense potential to become a world leader in revolutionising manufacturing with AM.
With advancement in industrial application of AM in various sectors including aerospace, building construction, military, defence, and healthcare, supporting industries such as electronic components and photonics used for developing these AM machines will also see a commensurate growth. Electronics materials such as metals, ceramics, polymers, glass and semiconductors have been printed with minimum dimension of few microns and all basic components of electronics such as resistor, capacitor, inductor, filters, PCB substrates, waveguides, transformers, ferrite core, motor, electromagnet and so on had been successfully demonstrated. The fundamental electronics required in AM machines include modules (including special types of printed circuits boards), passive and active components, SMD components and so on.
Pros and strengths
Established 3D Printing Ecosystem: The company is a 3D Printing solutions provider across India and offers Hardwares like: 3DPrinters, 3D Scanners, Laser engravers and 3d Pens, Consumables like: 3D Filaments and 3D Resins, Prototyping Services involving development of product prototype and designing and other services like: installation, AMC and After sales services. It is one stop solution for just everything about 3D Printing technology all under one roof. Further, the company has introduced wide range of 3D printers that are quick and simple to assemble and don’t require previous knowledge for new users. Many of its printers have dual hands-free auto-leveling feature that may automatically make up for the unevenness of the heat bed. Its 3D printers offer online printing, SD, USB, and USB-C. With the tools to generate 3D things, any DIY projects or even straightforward sketches become intriguing.
Established filament manufacturing capability for efficient backward integration: It has its manufacturing facility located at Bhiwandi, Maharashtra. Its manufacturing facility is accredited with ISO 9001:2015 for quality management system, ROHS, CE Certificate focused towards manufacturing of 3D Filaments with no jamming, no bubbles, user friendly with various colour pellets. As of March 31, 2024 its manufacturing facility has an aggregate production capacity of 144 tonnes per annum to manufacture 3D Filaments. It manufactures 3D filaments used in additive manufacturing process. It manufactures these thermoplastic filaments used in 3D printers made from Acrylonitrile Butadiene Styrene (ABS) and Polylactic Acid (PLA) plastic. The backward integration of its manufacturing facility has reduced its dependence on third party suppliers for raw materials required in its 3D Printers resulting greater control. Backward integration also provides upper edge in designing of its products, enhanced quality of products and customer retention capability.
Consistent focus on quality: Quality is a pre-requisite for a positive consumer experience and long-term brand loyalty. This philosophy has formed the foundation of the expansion and diversification of the company’s product portfolio since its inception. The company’s focus on quality is maintained at all stages right from the sourcing of raw materials, which is undertaken from manufacturers to the product manufacturing and assembly stage, which is subject to a rigorous review and monitoring process undertaken at its manufacturing facilities. For products which are sourced by it from third party suppliers, it has a dedicated sourcing team and quality assurance team, which closely monitors the quality of such products.
Risks and concerns
Dependent on key customers for a substantial portion of revenues: The company depends on certain customers who have contributed to a substantial portion of its total revenues. The company’s top 10 customers accounted, cumulatively, for 46.20%, 53.61% and 57.47% of its revenue from operations for the Fiscals 2024, 2023 and 2022 respectively. There is no guarantee that it will retain the business of its existing key customers or maintain the current level of business with each of these customers. Reliance on a limited number of customers for significant revenue may generally involve several risks. These risks may include, but are not limited to, reduction, delay or cancellation of orders from its significant customers, failure to renegotiate favourable terms with its key customers, the loss of these customers entirely, its inability to meet the expectations to track the changing preferences of its customers or non-acceptance of its products by customers, all of which would have a material adverse effect on the business, financial condition, results of operations and future prospects of the company.
Only manufacturing facility located at Bhiwandi, Mumbai: The company has its only manufacturing facility located at Bhiwandi, Mumbai wherein it manufactures 3D filaments. Its business is dependent upon its ability to manage its manufacturing facility, which is subject to various operating risks, including those beyond its control, such as the breakdown and failure of its machines or industrial accidents and severe climate conditions and natural disasters. Any significant malfunction or breakdown of its machinery may entail significant repair and maintenance costs and cause delays in its operations. If it is unable to repair breakdown of machinery in a timely manner or at all, its operations may need to be suspended until it procures new machinery to replace the same.
Stiff competition: The 3D Printing industry is highly fragmented as there is competition from various international players. There are some of the big multinational brands like Ulti Maker, Form Labs, Prusa, who are in competition to the domestic players. These domestic players include both - organised and unorganised players. The growth trajectory in the industry has encouraged new entrants to enter into this industry with new business models. In such competitive environment, to gain more market share the players are likely to reduce the pricing which is a challenge for the existing players. The company faces intense competition from other retailers that market products similar to it. The company also faces regional competition from local brands in the various geographies where its products are sold. It competes in various aspects, including brand recognition, value for money, user experience, breadth of product and service offerings, product functionality and quality, sales and distribution, supply chain management among others. Intensified competition may result in pricing pressures and reduced profitability and may impede its ability to achieve sustainable growth in its revenues or cause it to lose market share.
Outlook
WOL 3D India provides 3D Printing solutions, which enable easier prototyping and finding applications in various sectors, such as manufacturing, education, engineering, architecture, interior design, fashion design, product design, medical, and dental. It has India-based brand offering 3D printers, scanners, engravers, pens, filaments, resins, and prototyping services. Moreover, it has dedicated after-sales network to provide excellent customer support and ensure the success and satisfaction of its 3D printing customers. On the concern side, the company is highly dependent on certain key customers for a substantial portion of its revenues. Loss of relationship with any of these customers may have a material adverse effect on its profitability and results of operations. Moreover, the company is dependent on its manufacturing facility for manufacturing of filaments and it is subject to certain risks in such manufacturing process. Obsolescence, destruction, theft, breakdowns of its machines or failures to repair or maintain the same may affect its business, cash flows, financial condition and results of operations.
The company is coming out with a maiden IPO of 17,04,000 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 142-150 per equity share. The aggregate size of the offer is around Rs 24.20 crore to Rs 25.56 crore based on lower and upper price band respectively. On performance front, total income for the financial year 2023-24 stood at Rs 4001.43 lakh whereas in Financial Year 2022-23 the same stood at Rs 2371.32 lakh representing an increase of 68.74%. The main reason of increase was increase in the volume of business operations of the company. Moreover, the company’s profit after tax for the year increased by 109.23% from profit of Rs 240.56 lakh in financial year 2022-23 to net profit Rs 503.30 lakh in financial year 2023-24.
The company seeks to expand its geographical reach and address a broader market through expanded marketing, distribution, and customer engagement. It continually seeks to enhance its addressable market through its network of resellers. Moreover, it intends to expand its franchisee business model and develop distributors and dealers across the country. It plans to continue its strategy of diversifying and expanding its presence in other regions of the country for the growth of its business. Moreover, optimization of its online presence, including e-commerce platforms and digital marketing will further help to reach customers across India and globally.
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