Mangal Electrical IPO

The company has a proven track record of growth, with revenue from operations increasing 24.5% annually to ₹549.4 crore in FY25 from ₹354.3 crore in FY23.

The net profit margins of the company improved to 8.61% in FY25 from 4.66%, a year ago. Simply put, it's making ₹8.61 on every ₹100 of revenue. Additionally, its profits have grown 38.3% annually in the last two years from ₹24.7 crore in FY23 to ₹47.3 crore in FY25.

Among listed peers, the company makes the highest operating profits as of FY25, at 14.90% while its peers, Vilash Transcore and Jay Bee Lamination, make 12.62% and 11.70%, respectively.

The company holds PGCIL approval for 765 kV class transformers, obtained in FY25. It is also NABL-accredited and ISO 9001:2015 certified. These ensure high quality and enable it to cater to high-demand power infrastructure projects.

The company serves a diverse base of 128 customers across industries and geographies as of June 30, 2025. This includes various government entities, helping to reduce over-reliance on a single client.

The company achieves strong backward integration by in-house processing CRGO, Amorphous, and ICB, ensuring consistent quality and cost control. Its forward integration uses transformer manufacturing in EPC services. This optimizes production, minimizes costs, and enhances operational efficiency.

To meet working capital requirements and grow its business, the company’s borrowings have surged significantly from just ₹96.6 crore in FY23 to ₹149.1 crore in FY25 (24.2% annually).

Raw material expenses were ₹370.91 crore in FY25, with 24.91% imported (₹109.11 crore). Out of the total imports, China’s part accounted for 57.04% in FY25, followed by Singapore (16.22%), the United Arab Emirates (12.85%), Hong Kong (7.70%), and Japan (6.20%). Such heavy reliance on China raises supply chain and pricing risk if trade disruptions occur.

The company is taking longer to convert its investments in inventory and receivables back into cash. Its working capital days increased from 120 in FY24 to 131 in FY25. This means more cash is tied up for longer, which could lead to liquidity constraints, potentially impacting raw material procurement, debt payments, and overall business operations.

A substantial 70.69% of its FY25 revenue was generated from just three states: Gujarat, Rajasthan, and Uttar Pradesh. This reliance makes the company vulnerable to regional economic downturns or adverse local policy changes.

The company lacks direct hedging for key imports like CRGO and CRNO coils. The top 10 suppliers contributed 61.25% of total purchases, while the top 5 formed 40.6%, in FY25. This supplier concentration could impact cost stability and bargaining power.

Despite a diverse base, its top 10 customers accounted for 49.94% of revenue in FY25 which include Transformers and Rectifiers (I) Limited (9.44%), TBEA Energy (India) Private Limited (8.48%), Shirdi Sai Electricals Limited (3.93%), etc, meaning a reduction in orders or loss of these key clients, including government contracts, could significantly impact its revenue.