New Delhi, May 12 -- Industrial and automotive parts maker JK Fenner (India) Ltd is evaluating picking up a large stake in a South India-based precision components manufacturer, at least two people aware of the development told VCCircle.
The Chennai-headquartered company, which is part of the diversified JK Group, is in discussions to invest in Bengaluru-based Shakti Precision Components (India) Pvt Ltd, one of the people said, asking not to be named.
The person said that the deal size is likely to be around Rs 400 crore ($41.8 million) and that the transaction may even involve JK Fenner buying a majority stake in the target company.
The second person said mid-market investment bank o3 Capital was helping Shakti Precision to scout for potential suitors for a transaction.
Email queries sent to JK Fenner and Shakti Precision remained unanswered till the time of publishing this article. An o3 Capital spokesperson declined to comment on the matter.
Shakti Precision Components, launched in 1992, manufactures products for industries such as automotive, agriculture, railways, textiles, and transport. It posted revenue from operations of Rs 317 crore in FY24, down from Rs 338 crore the year before, while net profit rose to Rs 5.2 crore from Rs 50 lakh, as per VCCEdge.
As for JK Fenner, the company was acquired by JK Organisation in 1987. It has diversified from manufacturing power transmission V-belts to providing belt systems, sealing systems, and fluid transmission products. Its products are used in vehicles, factories, farms, railways, and heavy machinery.
JK Fenner operates nine manufacturing plants, including five in Tamil Nadu. The company also has renewable energy assets of 9.75 MW and three R&D centres with a team of over 120 specialists. It supplies products to global original equipment manufacturers such as John Deere, Timken, AutoZone, and Dana, in addition to Indian manufacturers.
JK Fenner generated revenue of Rs 1,473 crore in FY25 as against Rs 1,300 crore the year before. The company's net profit grew to Rs 198 crore from Rs 155 crore during the corresponding period, as per VCCEdge.
The industrial and precision components segment, particularly the aerospace vertical, has seen strong interest from strategic players and financial investors in recent months.
For instance, Unimech Aerospace and Manufacturing Ltd last month acquired tubing and precision-engineered components manufacturer Hobel Bellows Co. for $48 million. In March, Rangsons Aerospace, a provider of defence and aerospace manufacturing solutions, raised Rs 300 crore from private equity firm ValueQuest. The same month, Zomato CEO Deepinder Goyal invested $20 million in LAT Aerospace, a stealth-mode startup co-founded with former Zomato COO Surobhi Das. In February, aerospace components manufacturer JJG Aero Pvt Ltd raised $30 million in Series B funding from venture capital firm Norwest Venture Partners.
Published by HT Digital Content Services with permission from VC Circle.