IPO Size: Rs. 400 cr, Entirely Fresh Issue 

• Rs. 122 cr for working capital
• Rs. 101 cr for debt repayment, of Rs. 149 cr debt
• Rs. 88 cr for capex

Price band: Rs. 533-561 per share

M cap: Rs.1,550 cr, implying 26% dilution

IPO Date: Wed 20^th Aug to Fri 22^nd Aug 2025, Listing Thu 28^th Aug 2025

Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.

Transformer and Components Manufacturer

Mangal Electrical Industries is a 36 year old Jaipur-based manufacturer of transformer components such as CRGO (cold rolled grain oriented) slit coils, amorphous cores, immersed circuit breakers (ICB), accounting for 70% of annual Rs. 550 cr topline. Balance 23% revenue comes from manufacturing of medium power transformers (single-phase 5 KVA to three-phase 10 MVA) and 7% from electrical EPC services. Company has 5 manufacturing facilities in Rajasthan, with an aggregate annual capacity of 16,200 MT for CRGO and 10.2 lakh KVA for transformers, which were 60% and 95% utilized respectively in FY25.  

Major Capacity Addition

To meet future demand, company is undertaking Rs. 88 cr capex from IPO proceeds.

1. This will double CRGO capacity by Jan 2026. CRGO, the most critical component in transformer manufacturing, accounts for 60% of current revenue.  
2. Also, diversify into high voltage transformer manufacturing, of 132 KV up to 200 MVA, by Dec 2026.

This expansion is quite material, as gross fixed assets stood at Rs. 86 cr as of 31.3.25, with net fixed assets at only Rs. 41 cr. Expansion will start yielding financial benefits from FY27E onwards.

Healthy Financials

On higher volumes, FY25 revenue grew 22% YoY to Rs. 549 cr, with 15% EBITDA margin. PAT more than doubled YoY to Rs. 47 cr, implying net margin of 8.6%. On small equity of Rs. 20.5 cr (face value Rs. 10 each), FY25 EPS was at Rs. 23. On Rs 163 cr net worth, 34% RoE is seen very attractive.

Valued for Future Growth

Higher product demand and partial interest cost savings on debt repayment leads to an FY26E estimated PAT of about Rs. 60 cr. This results in a PE multiple of 22x, on current year basis. While this may appear high for a micro-cap stock, critical technology of CRGO, ongoing capex, rising transformer demand and 74% promoter holding, post IPO are key positives. Next 18 months may witness significant financial growth, in line with the bullish order books of all transformer makers. Thus, Mangal Electrical is on track to seize the opportunity.