Laser Power & Infra IPO Review: Can Its Strong Order Book Offset Cash Flow Risks?

India's growing investment in power infrastructure has put companies like Laser Power & Infra in the spotlight. The company manufactures power cables and conductors while also building electricity transmission and distribution projects across the country. Laser Power & Infra’s IPO is worth ₹742 crore, through which it plans to raise fresh capital mainly to reduce debt, while existing shareholders will also sell a part of their stake. At the upper price band of ₹214, the company is seeking a post-IPO valuation of around ₹3,004 crore.

At first glance, the IPO appears attractively priced compared with listed peers. But is the valuation enough to compensate for its high debt, slow customer payments, and dependence on government contracts? In this review, we'll look beyond the headline numbers to understand whether the business quality supports the valuation.

Laser Power & Infra IPO Snapshot

Source of GMP: Economic Times | Disclaimer: GMP is an unofficial market indicator and is provided for informational purposes only. It is not a reliable predictor of listing performance, and we do not encourage investment decisions based on GMP.

What Does Laser Power & Infra Actually Do?

Think of India's electricity network as a giant highway that carries power instead of vehicles. Laser Power & Infra helps build and maintain that highway.

The company operates through two connected businesses. First, it manufactures conductors, cables, and other products that carry electricity over long distances. Second, it executes EPC (Engineering, Procurement and Construction) projects, where it designs and builds complete power transmission and distribution systems, including substations, transmission lines, power poles, and underground cable networks.

Its manufacturing business is the larger contributor, accounting for nearly 73% of FY26 revenue, while the EPC business contributed the remaining 27%. Having both businesses under one roof gives the company an advantage. Instead of buying all its materials from outside suppliers, it manufactures many of them itself, helping reduce costs and giving better control over project execution.

Most of its customers are government electricity boards and the Indian Railways, which regularly invest in expanding and upgrading India's power network. Over the years, the company has completed projects across 26 Indian states and in 10 overseas countries, including Bhutan and Togo.

Looking ahead, Laser Power & Infra is also trying to diversify beyond traditional power transmission. It is expanding into solar projects, battery energy storage systems, and water distribution pipelines. It has also partnered with TS Conductor Corp to manufacture advanced conductors that can transmit more electricity with lower energy losses, positioning itself for the next phase of grid modernisation.

Can Laser Power & Infra Benefit from India's Power Boom?

Laser Power & Infra's growth is closely linked to India's expanding power infrastructure. The domestic wires and cables market, valued at ₹1.41 lakh crore in FY25, is expected to grow at 11% to 13% annually and reach up to ₹2.55 lakh crore by FY30. Demand for conductors is also rising as the country modernises its electricity grid.

This growth is being driven by rising power consumption, rapid renewable energy expansion, and government initiatives such as the Green Energy Corridor, RDSS, and railway electrification, all of which require significant investment in transmission infrastructure.

However, a growing market does not guarantee success. The company faces competition from much larger players, while volatile aluminium and copper prices, delayed government payments, and project execution challenges can affect profitability.

Even so, Laser Power & Infra appears well placed to benefit. Its integrated manufacturing model helps control costs, while its ₹3,243 crore order book and approved vendor status with Indian Railways provide good revenue visibility. The key challenge will be converting this demand into stronger cash flows while reducing debt and improving working capital management.

What Makes Laser Power & Infra Strong?

A strong business is not just about current profits but also its ability to sustain growth over time. Laser Power & Infra has three key strengths that support its long-term prospects.

1. A growing order book provides revenue visibility

The company's order book grew nearly 49% from ₹2,172.74 crore in FY24 to ₹3,243.40 crore in FY26. Since these are already secured projects awaiting execution, they provide good visibility into future revenue.

For investors, this reduces business uncertainty as the company already has a healthy pipeline of work. While project execution remains important, a large order book offers a stronger starting position for future growth.

2. Manufacturing its own products helps control costs

Laser Power & Infra manufactures many of the conductors and cables used in its own EPC projects instead of sourcing them from outside suppliers.

This backward integration reduces supplier dependence, improves quality control, and helps manage costs when raw material prices fluctuate. The value of products used in its own projects increased from ₹259.64 crore in FY24 to ₹354.39 crore in FY26, showing that this strategy is becoming a larger part of the business.

3. Profitability is moving in the right direction

The company's EBITDA margin improved from 8.93% in FY24 to 12.96% in FY26, meaning it retained more operating profit from every ₹100 of revenue.

This indicates better cost efficiency despite operating in a competitive industry. Although FY26 profit included a one-time accounting gain, the improvement in operating margins suggests the core business has become stronger over the past three years.

What Are The Real Risks?

The business also carries risks that investors should not overlook.

1. Heavy dependence on a few customers

The top 10 customers contributed over 72% of operating revenue in FY26, up from about 53% in FY24.

Most are government utilities. While these contracts are usually large, relying heavily on a few customers increases concentration risk. Losing a major contract or facing delays in new orders could significantly affect revenue and profitability.

2. Slow payments continue to pressure cash flows

The company took an average of 196 days to collect payments in FY26, up from 145 days in FY24, mainly because government customers often pay slowly.

This ties up cash for long periods while the company still needs to pay employees, suppliers, and lenders, increasing its reliance on borrowings to fund day-to-day operations.

3. High debt remains an important concern

As more cash became locked in working capital, operating cash flow turned negative ₹119.05 crore in FY26 from a positive ₹60.34 crore a year earlier, pushing total borrowings to ₹828.23 crore.

The IPO money will mainly be used to reduce debt, which should lower interest costs. However, investors should watch whether cash flows improve after listing, as stronger profits alone are not enough if customer payments continue to be delayed.

Valuation & Peer Comparison

At the upper price band of ₹214, Laser Power & Infra is valued at a post-IPO market capitalisation of around ₹3,004 crore. Based on reported FY26 earnings, the IPO is priced at a P/E ratio of 19.82x, significantly lower than larger listed peers such as Apar Industries, Polycab India and KEI Industries. On the surface, that makes the IPO look attractively priced.

However, looking only at the P/E ratio does not tell the full story.

FY26 profit included a one-time accounting gain of ₹32.79 crore from the sale of a subsidiary. Since this was not generated by the company's regular business, the underlying earnings are slightly lower than the reported figure.

The business also carries relatively high debt because of its working capital requirements. For companies like this, EV/EBITDA often provides a more balanced valuation measure since it considers both equity value and debt.

On this basis, Laser Power & Infra trades at an EV/EBITDA multiple of about 12.62x. That appears reasonable for a company with improving operating margins, a growing order book and an integrated manufacturing model. At the same time, the lower valuation partly reflects the risks associated with high borrowings, slow cash collections and its smaller scale compared with industry leaders.

Author's Take: Should You Consider This IPO?

Laser Power & Infra operates in an industry that is expected to benefit from India's long-term investment in electricity transmission, renewable energy and grid expansion. The company has built meaningful strengths through its integrated manufacturing model, improving operating profitability and a healthy order book that provides visibility into future revenue.

That said, investors should not ignore the challenges. High debt, negative operating cash flow and long payment cycles from government customers continue to put pressure on the business. While the IPO proceeds should improve the balance sheet, sustained improvement will depend on better cash collections and disciplined execution.

From a valuation perspective, the IPO appears reasonably priced, especially when compared with larger listed peers. However, the discount also reflects genuine business risks rather than being a bargain without concerns.

Overall, Laser Power & Infra appears to be a balanced but cautiously positive IPO. It offers exposure to a sector with favourable long-term tailwinds and a business that has shown operational improvement, but investors should monitor its debt levels, cash flow generation and execution quality even after the company becomes listed.