Acme India Industries Limited, a specialized player in the Indian railway rolling stock sector, has filed its Draft Red Herring Prospectus for a fresh issue of ₹85.27 crore. The company, which offers turnkey furnishing, refurbishment, and toilet modernization services, reported revenue from operations of ₹263.71 crore in FY2026.

About the Company

Acme India Industries Limited operates in the Indian railway infrastructure sector with three core service lines: turnkey furnishing of new railway coaches, refurbishment and upgradation of old coaches, and modernization of toilet facilities. Originally started as a sole proprietorship in 2012, the company was incorporated as a private limited entity in 2021. It currently operates across all 16 railway zones in India through three production units and two mid-life rehabilitation units.

Since 2017, the company has delivered 1,610 turnkey coaches, refurbished 1,888 coaches, and completed 10,948 toilet upgrades across 28 coach variants. Its manufacturing facility in Sonipat, Haryana, spans 92,000 sq. ft. and holds ISO 9001:2015 and ISO 15085 certifications. The company maintains exclusive tie-ups with entities from Russia, USA, Belgium, and South Korea for specialized products used in projects such as Vande Bharat and Metro rail.

Financial Performance

The company’s revenue from operations grew from ₹213.43 crore in FY2024 to ₹263.71 crore in FY2026, reflecting a 25.57% increase in the last fiscal year. Net profit rose to ₹24.36 crore in FY2026 from ₹16.46 crore in FY2025. Total assets expanded significantly to ₹382.79 crore in FY2026, driven by growth in current assets.

Despite reported profits, operating cash flows were negative at ₹11.50 crore in FY2026 and ₹6.09 crore in FY2024. The working capital gap increased to ₹15,481.72 lakh in FY2026 from ₹8,257.64 lakh in FY2024.

Why the Company Is Raising Funds

The fresh issue proceeds will be utilized for specific corporate objectives:

• Working Capital Requirements: ₹38.00 crore to fund the growing working capital gap driven by trade receivables and inventories.
• Repayment of Borrowings: ₹41.00 crore to repay or pre-pay existing debt, reducing the total outstanding indebtedness of ₹8,518.21 lakh as of March 2026.
• Capital Expenditure: ₹6.27 crore for purchasing plant and machinery, including 3D printers, press brakes, and welding machines.
• General Corporate Purpose: Subject to a cap of 15% of gross proceeds or ₹10 crore, whichever is lower.

Business Strengths

• Strong Order Book: The company held an order book of ₹73,797.33 lakh (₹737.97 crore) as of June 30, 2026, providing revenue visibility equivalent to approximately 2.8 times FY2026 revenue.
• Market Presence: Operations cover all 16 railway zones, with significant diversification in the order book including toilet upgradation (46.92%) and supply to private clients (31.04%).
• Certified Infrastructure: The Sonipat facility is ISO 9001:2015 and ISO 15085 certified, critical for compliance with Indian Railways standards.
• Experienced Leadership: Promoters possess over 28 years of combined industry experience, while board members bring expertise from Indian Railways and NTPC.

Key Risks

• Customer Concentration: Indian Railways contributed 46.77% of total revenue in FY2026, creating dependency on government policy and spending cycles.
• Negative Cash Flows: Persistent negative operating cash flows in FY2024 and FY2026 indicate structural working capital stress.
• Contingent Liabilities: Total contingent liabilities stood at ₹9,463.66 lakh as of March 2026, including bank guarantees and tax demands.
• Compliance Issues: The DRHP discloses 33 instances of delayed ROC filings and delays in GST and EPF payments, highlighting regulatory non-compliance risks.
• Seasonality: 91.13% of FY2026 revenues were concentrated in the October–March period, leading to quarterly cash flow volatility.

Important IPO Dates

• IPO Opening Date: 30-Sep-2026
• IPO Closing Date: 05-Oct-2026
• Allotment Date: 06-Oct-2026
• Listing Date: 08-Oct-2026

Bottom Line

Acme India Industries presents a growth story backed by a substantial order book and expanding asset base. However, the filing highlights significant concerns regarding negative operating cash flows, high working capital gaps, and recurring compliance deficiencies that warrant scrutiny alongside its strong revenue trajectory.