On August 2, 2024, Hercules Hoists Ltd. (HHL) demerged its manufacturing business into the newly formed Indef Manufacturing Ltd (IML). The rationale for the demerger was to unlock value and allow each business to pursue its own strategy. The demerger has attracted investor interest and freed up capital for growth.
The split created two pure plays: HHL as an (RBI-regulated) core investment company, and IML as a focused manufacturer. The transaction resulted in splitting of manufacturing and investment businesses to ensure focused management attention, resources, and skill set allocation for each business. In short, HHL now concentrates on managing its equity stakes, while IML devotes all capital and management bandwidth to a high-growth manufacturing material handling equipment enterprise, driven by quality, technology, and strategic expansion.
Investment Case ~Value Unlocking
Separating Indef Manufacturing allows sharper strategic focus and capital allocation. IML can now reinvest cash flow entirely in its operations (new plants, R&D, working capital) without being diverted to unrelated investments. As a pure-play manufacturer, Indef is likely to be valued on its growth prospects and margins, potentially receiving a higher multiple than it did as part of Hercules Hoists. The market often re-rates subsidiaries after a demerger if the business is stronger on its own. In short, shareholders could see sharper earnings per share growth at IML (and better return on capital) as the company executes its expansion plans.
What excites us the most is that despite being a modest ₹400 crore market cap company, Indef Manufacturing Limited enjoys a significant strategic edge due to its association with the highly reputed Bajaj Group. This pedigree lends the company strong brand credibility, robust corporate governance, and access to group-level synergies in technology, talent, and operational expertise.
As of March 2025, the promoter and promoter group, including Bajaj Holdings & Investment Ltd (19.53%), Jamnalal Sons Pvt Ltd (19.35%), and other Bajaj family entities, collectively hold a substantial 69.61% stake in the company, demonstrating deep promoter commitment and instilling investor confidence. In our view, this deep-rooted affiliation with the Bajaj Group not only reinforces Indef’s long-term strategic direction but could also act as a catalyst for valuation re-rating, as the market tends to assign premium multiples to businesses backed by credible promoters with a proven track record.
Valuations
IML (market cap ~₹697 Cr at ₹217 per share)
The demerger has created a pure-play manufacturer with a globally respected Bajaj Indef brand and a pedigree of engineering excellence. If IML can sustain its growth and modestly improve margins by leveraging scale, the market could re-rate the stock significantly. Indef Manufacturing currently trades at 27xTTM EVEBITDA and 24x TTM PE. For context, the Industry trades at a PE of 34.37x.
The company has negligible leverage, so cash generation will fund new capacity and working capital without stressing the balance sheet. The Indian industrial cycle and infrastructure push provide a secular tailwind that should benefit well-placed domestic crane/hoist makers.
That said, investors should remain mindful of execution and market headwinds. But if Indef executes its expansion plans (e.g. scaling up the Chakan facility, rolling out new models) and capitalizes on industrial growth, it could deliver robust returns. In sum, we view Indef as a value-unlocking name in Indian industrials – not without risks, but with a clear growth runway that justifies a modestly bullish outlook.
Company Overview
Indef Manufacturing Limited (IML) is the pure-play manufacturing arm of the former Hercules Hoists (Bajaj Indef) business, carrying forward the Bajaj Indef legacy in material handling equipment. For over six decades, Bajaj Indef has been a leader in hoists, cranes and lifting solutions, known for innovation, safety and reliability. IML offers a broad product range – from manual and electric chain hoists to EOT cranes, wire-rope hoists and storage/retrieval systems – with lifting capacities from 0.25 T up to 90 T.
Products and services
- Manufacturing, sales, distribution, and marketing of mechanical hoists, electric chain hoists and wire rope hoists
- Stackers, storage and retrieval solutions
- Overhead cranes in standard and extended standard range
- Manipulators, material handling automation solutions.
Production Facilities
The company has ISO 9001:2015 standards at Khalapur and Chakan plants, with additional certifications including ISO 14001:2015 and ISO 45001 :2018 at the Khalapur facility. Moreover, its products such as Chain Pulley Blocks, Electric Chain Hoists, and Wire Rope Hoists adhere to ISI and CE standards. Also, the flameproof variants of its Hoists are Atex certified.
Industries Served by IML
Indef serves a wide variety of industries – from discrete manufacturing, cement, power, and infrastructure to warehousing and construction – and has built a nationwide distribution and service network (50+ dealers/clinics) to reach MSMEs and large EPC projects.
Distribution Network
The company has a distribution and service network across India through its Authorized Business Partners (ABPs) and sub-dealers. The ABPs also act as service providers to their customers through an established network of Indef Clinics. HHL has also established direct sales offices in Mumbai, Pune, Delhi, Chennai, and Kolkata.
Geographical Location:
The company is present in 28 states and 12 countries worldwide
Clientele
The company deals with customer through Dealers network and direct channel. The Industrial units/ warehouses /plants /EPC project companies /project sites etc. are its customers
Revenue Breakup – FY24
Recent developments include a successful listing on BSE/NSE in Feb 2025. The Bajaj Indef brand, long associated with Hercules Hoists, is now the centerpiece of IML, with management led by MD Amit Bhalla and Chairman Shekhar Bajaj. In announcing the listing, Mr. Bajaj emphasized that IML is “ready to harness our full potential” as an independent entity, poised to sharpen its focus on innovation, strengthen market presence, and expand globally. IML has also showcased new products (e.g. “Glacier” food-grade hoists) at industry expos and recently renewed key licenses (ISI, ATEX) to bolster its technological edge and service offerings.
Also Read: Top Steel Stocks To Buy
Financial Performance
Pre Demerger
| Rs in Cr | Mar-19 | Mar-20 | Mar-21 | Mar-22 | Mar-23 | Mar-24 | 3 YR CAGR | 5 YR CAGR |
| Sales | 102 | 83 | 78 | 108 | 151 | 180 | 32% | 12% |
| Expenses | 93 | 78 | 74 | 102 | 134 | 150 | ||
| Operating Profit | 9 | 5 | 4 | 7 | 17 | 29 | 94% | 26% |
| OPM % | 9% | 6% | 5% | 6% | 11% | 16% | ||
| Other Income | 10 | 15 | 8 | 14 | 104 | 22 | ||
| Interest | 0 | 0 | 0 | 0 | 1 | 1 | ||
| Depreciation | 3 | 4 | 3 | 2 | 4 | 4 | ||
| Profit before tax | 16 | 16 | 10 | 18 | 116 | 47 | 68% | 24% |
| Tax % | 21% | 19% | 19% | 19% | 11% | 23% | ||
| Net Profit | 13 | 13 | 8 | 15 | 103 | 36 | 65% | 23% |
Pre-demerger (as Hercules Hoists standalone), the Bajaj Indef manufacturing division showed robust growth. The company has demonstrated strong revenue recovery post-pandemic, with sales growing at a 32% CAGR over 3 years (12% CAGR over 5 years), reaching ₹180 Cr in FY24 from ₹78 Cr in FY21. Operating leverage is clearly playing out—Operating Profit has grown at 94% CAGR (3Y), with margins expanding from a low of 5% in FY21 to 16% in FY24, aided by cost efficiency and better scale.
IML is effectively debt-free (HHL’s interest cost was negligible), so most profit flowed to equity. Return on capital was modest in FY24 (single-digit ROCE/ROE) (6%/5%) due to the large asset base, but this base did include surplus cash and investments from prior years.
Post Demerger
| Rs in Cr | Dec-23 | Jun-24 | Sep-24 | Dec-24 | TTM |
| Sales | 39.94 | 38.14 | 42.77 | 44.22 | 165.07 |
| Expenses | 33.92 | 32.5 | 35.94 | 36.7 | 139.06 |
| Operating Profit | 6.02 | 5.64 | 6.83 | 7.52 | 26.01 |
| OPM % | 15.07% | 14.79% | 15.97% | 17.01% | 16% |
| Other Income | 3.62 | 3.53 | 5.84 | 3.31 | 16.3 |
| Interest | 0.13 | 0.12 | 0.11 | 0.1 | 0.46 |
| Depreciation | 1.08 | 1.19 | 1.36 | 1.33 | 4.96 |
| Profit before tax | 8.43 | 7.86 | 11.2 | 9.4 | 36.89 |
| Tax % | 33.57% | 27.10% | -0.98% | 24.89% | |
| Net Profit | 5.6 | 5.73 | 11.31 | 7.06 | 29.7 |
Value unlocking is starting to get seen in the numbers. Post-demerger, Indef Manufacturing Ltd (IML) is demonstrating significantly improved financial efficiency. The company’s ROE has expanded to ~12.7% and ROCE to ~15.6%—a sharp uplift from pre-demerger single-digit returns. Asset turnover now stands at ~0.58x up from 0.20x, indicating a still-underutilized but well-funded asset base. The clean split has enabled focused execution, visible in stronger margins, disciplined capital allocation, and a more scalable platform for growth.
SWOT Analysis and Key Risks
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Strengths: Strong Bajaj Indef brand legacy; diversified product portfolio and wide capacity range; ISO/CE-certified manufacturing plants (Chakan, Khalapur) with recent capacity expansions. Extensive distribution/service network (~50+ partners nationwide) and long-standing customer relationships underscore reliability. The focus on engineering (in-house design) and certifications (e.g. ATEX, ISI renewals) bolster quality and allow entry into specialized markets (e.g. food-grade cranes). Finally, the demerger has attracted investor interest and freed up capital for growth.
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Weaknesses: Relatively small scale and financial base compared to peers; asset-heavy business (resulting in low current asset turnover). Historically, operating margins have been modest due to competition and commodity costs. Corporate governance remains promoter-driven (Bajaj family influence), and IML must prove its standalone management effectiveness. As a new listing, its historical track record is limited, making analysts wary.
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Opportunities: Rising demand for material handling equipment in India – fueled by infrastructure projects, logistics and warehousing growth, “Make in India” manufacturing expansion, and urbanization. Research firms project the Indian MHE market to nearly double by 2033 (CAGR ~8%). IML can capitalize on this by introducing new products (digital / connected cranes, energy-efficient designs), expanding in exports, and using its dealer network to gain share. The ability to pursue acquisitions or JV’s (with domestic or European partners) is now easier as a focused company. Government initiatives (e.g. PLI for manufacturing, renewable energy projects requiring lifting solutions) also play to IML’s strengths.
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Threats/Key Risks: The material handling sector is cyclical – a slowdown in industrial capex (from metals, cement, auto or power) would hit order intake and margins. Competition from both organized players and smaller unorganised manufacturers (sometimes with cheaper imports) can pressure prices. Raw-material inflation (steel, electricals) could squeeze margins if not passed on. Execution risk looms if IML overextends (e.g. too-rapid plant expansions or new facility delays). Currency volatility and global slowdowns could affect export prospects. Finally, any failure to meet product or delivery commitments could damage the brand; quality issues or safety incidents (e.g. crane accidents) would be particularly damaging.
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