Dhoot Transmission Bets on EV Shift Ahead of IPO

Every time a two-wheeler's headlight switches on, its indicator blinks or its speedometer lights up, an unseen network of wires is doing the work. That network, called a wiring harness, is the product Dhoot Transmission Limited has built its business around for nearly three decades. This month, the Chhatrapati Sambhajinagar-based auto components manufacturer completed a ₹3,066.89 crore initial public offering and made its debut on the Indian stock markets, positioning itself as a direct play on the country's shift toward electric two-wheelers and three-wheelers.

Who Dhoot Transmission Is

Incorporated in April 1998, Dhoot Transmission designs, engineers, manufactures and supplies wiring harnesses and electrical distribution systems for vehicles and other equipment. A wiring harness is, in simple terms, the bundle of wires and connectors that carries electrical signals and power between a vehicle's battery, switches, lights, sensors and control units. It performs a role similar to a nervous system, allowing different parts of a vehicle to communicate and function together.

Beyond wiring harnesses, the company's product range includes battery packs, sensors, electronic controllers, automotive switches, terminals, connectors and power supply cords. These are supplied for both internal combustion engine (ICE) vehicles and electric vehicles, across two-wheelers, three-wheelers, commercial vehicles, off-highway equipment and other industrial applications. The company operates roughly 22 manufacturing plants spread across Maharashtra, Tamil Nadu, Haryana and Madhya Pradesh in India, along with facilities in the United Kingdom, Slovakia and Thailand, and it employed more than 2,681 people as of December 31, 2025.

Position in the Automotive Components Industry

Dhoot Transmission ranks among the top two suppliers of wiring harnesses to India's two-wheeler and three-wheeler makers, with a combined market share of about 41 per cent in that segment during FY26. In the electric two-wheeler and three-wheeler space specifically, its share is close to 70 per cent, making it the largest supplier in that category. The more widely known listed peer in this space is Motherson Sumi Wiring India, which has a larger overall revenue base but operates across a broader mix of vehicle categories.

Why the EV Shift Matters for the Company

Electric vehicles generally require a greater volume and complexity of wiring and electronic components than ICE vehicles, since functions such as battery management, motor control and charging depend heavily on electrical systems rather than mechanical ones. This makes wiring harness suppliers more central to vehicle design in the EV era than they were in the past. Industry estimates cited around the IPO suggested that the EV wiring harness segment in India could grow annually at 33 to 35 per cent between FY26 and FY31, well ahead of the growth expected in ICE-related wiring harnesses.

Dhoot Transmission entered the EV components business in the 2019-20 financial year, when it introduced a product line of charging cables, connectors and plugs for electric vehicles. It later commissioned a dedicated production line for EV chargers with an annual capacity of 3 million units in November 2024, and had supplied 2.23 million chargers by December 31, 2025. The company has also expanded into battery packs and battery management systems for EVs, and describes its EV offering as extending to charging solutions as well.

Customers and Concentration

The company's customer base includes Bajaj Auto, TVS Motor Company, Honda Motorcycle & Scooter India and Royal Enfield, among others. Following its acquisition of Multilink, Hero MotoCorp has also become a customer. Together, its OEM customers in the two-wheeler segment accounted for a combined 69.37 per cent share of the Indian two-wheeler market in FY26.

This customer base is also a source of concentration risk that the company has disclosed. Its top 10 customers contributed 80.93 per cent of FY26 revenue, and Bajaj Auto alone accounted for 31.84 per cent, or about ₹1,440.83 crore. Wiring harnesses made up roughly 77 per cent of total revenue in FY26, and the Indian two-wheeler segment alone contributed about 65 per cent of revenue. This means the company's fortunes remain closely tied to a small number of large customers and to one product category and vehicle segment.

Recent Financial Performance

Dhoot Transmission's revenue grew from ₹3,472.24 crore in FY25 to ₹4,563.70 crore in FY26, an increase of roughly 31 per cent. Profit after tax rose from ₹353.89 crore in FY25 to ₹396.84 crore in FY26, a smaller increase of about 12 per cent, while EBITDA for FY26 stood at ₹710.99 crore. The gap between revenue growth and profit growth points to some margin pressure, which analysts covering the IPO have linked to the costs of capacity expansion and a changing product mix.

IPO Details

The IPO opened for subscription on August 10, 2026, and closed on August 12, 2026. It comprised a fresh issue of shares worth ₹1,400 crore and an offer for sale of up to ₹1,666.89 crore by existing shareholders, taking the total issue size to ₹3,066.89 crore. The price band was set at ₹829 to ₹871 per share, with a lot size of 17 shares, meaning the minimum retail investment at the upper end of the band was ₹14,807. Axis Capital, along with other book running lead managers including Jefferies India, Kotak Mahindra Capital, Nomura and SBI Capital Markets, managed the issue, and Kfin Technologies served as registrar.

As per the Red Herring Prospectus, the company intends to use ₹464.8 crore of the net proceeds to repay or prepay its own borrowings, and a further ₹301.77 crore to help three subsidiaries, Dhoot Autocomponents, Dhoot Automotive Systems and Dhoot Transmission UK, repay their borrowings. Another ₹150 crore is earmarked for setting up new wiring harness plants at Jhajjar in Haryana and Shoolagiri near Hosur in Tamil Nadu, at a combined project cost of about ₹225 crore, with the balance to come from internal accruals. The remaining proceeds are set aside for potential acquisitions and general corporate purposes. Because the offer for sale portion goes to selling shareholders rather than the company, Dhoot Transmission itself receives proceeds only from the fresh issue component.

Ahead of the public offer, the company raised ₹918.27 crore from 72 anchor investors at the upper end of the price band, including domestic mutual funds such as SBI Mutual Fund, ICICI Prudential Mutual Fund and HDFC Mutual Fund, along with insurers, pension funds and foreign portfolio investors. Shares were listed on the NSE and BSE on August 17, 2026.

How Investors Responded

The IPO drew a strong response. Overall subscription stood at 74.21 times, with the qualified institutional buyers category subscribed 212.92 times, the non-institutional investor category 51.93 times, and the retail category 8.12 times. On listing day, the stock opened at ₹1,200 on the NSE, a premium of 37.77 per cent over the issue price of ₹871, and at ₹1,193.80 on the BSE, up 37.06 per cent. Kranthi Bathini, director of equity strategy at WealthMills Securities, noted that "the euphoria in Indian IPO market is coming back," pointing to the broader pickup in primary market activity through 2026. In the days following listing, the stock continued to trade above its issue price, though, as with any newly listed company, its price has fluctuated with overall market conditions.

Bain Capital's Role

Dhoot Transmission's promoters are BC Asia Investments XV Limited, an entity linked to global private equity firm Bain Capital, and Rahul Radhavallabh Dhoot. Combined promoter shareholding stood at 99.99 per cent before the IPO and is expected to fall to around 82.78 per cent after the issue, reflecting the shares sold through the offer for sale and the fresh issue dilution. Bain Capital's continued presence as a promoter, alongside the Dhoot family, gives the company access to institutional governance experience as it transitions to a publicly listed entity.

Growth Opportunities from EV Adoption

India's push toward electric mobility, particularly in the two-wheeler and three-wheeler categories where adoption has been fastest, gives Dhoot Transmission a large addressable opportunity given its already dominant position in EV wiring harnesses. Its diversified product range, spanning wiring harnesses, battery packs, sensors and chargers, also creates scope for the company to sell more components per vehicle to existing customers as EV models become more electronically complex. The planned new plants in Haryana and Tamil Nadu are intended to add capacity closer to customer manufacturing hubs, which the company has said can reduce delivery time and logistics costs.

Key Risks

Several risks are worth noting for a company at this stage. Customer concentration remains significant, with a small set of two-wheeler makers, led by Bajaj Auto, contributing a large share of revenue. Dependence on the two-wheeler and three-wheeler segment, and on wiring harnesses as a product line, also leaves the company exposed to slowdowns in that part of the automotive cycle or to shifts in vehicle technology that could reduce demand for its current product mix. Competition from larger and more diversified players such as Motherson Sumi Wiring India is another factor, as is execution risk tied to ramping up new manufacturing capacity on schedule. On valuation, the IPO was priced at a price-to-earnings multiple in the mid-to-high 30s based on FY26 earnings, a level analysts have generally viewed as reasonable relative to listed peers but one that still requires sustained earnings growth to be justified over time. As with any recently listed stock, near-term price movements can also be influenced by broader market sentiment rather than company fundamentals alone.

Conclusion

Dhoot Transmission's IPO reflects a broader interest among investors in India's automotive electrification story, and the company's existing leadership in EV wiring harnesses for two-wheelers and three-wheelers gives it a head start in a segment that is expected to keep growing faster than the traditional ICE components business. At the same time, its reliance on a concentrated customer base and a single dominant vehicle category means its growth path is not without risk. How well the company converts its EV positioning into broader, more diversified revenue over the coming years, while managing margins and executing its capacity expansion plans, will likely determine whether its early market debut translates into sustained performance as a listed company.