IC Electricals IPO opens Jun 25 to fund working capital needs
IC Electricals Company Limited is launching an IPO on 25-Jun-2026 to raise ₹33.60 crore, primarily for working capital. The firm, which derives 82.01% of revenue from the Ministry of Railways, saw revenue grow to ₹143.04 crore and net profit to ₹14.08 crore in FY26. However, investors should note negative operating cash flows and high working capital intensity.
*this image is generated using AI for illustrative purposes only.
IC Electricals Company Limited has initiated its Initial Public Offering (IPO) to raise capital for working capital requirements and general corporate purposes. The issue is scheduled to open on 25-Jun-2026 and close on 30-Jun-2026, with a proposed listing date of 03-Jul-2026 and an allotment date of 01-Jul-2026. The New Delhi-based manufacturer specializes in electronic equipment and engineering solutions for the Indian Railways, operating under a Business-to-Government (B2G) model where the Ministry of Railways contributes 82.01% of total revenues.
Financial Performance
The company has reported consistent top-line growth over the past three fiscal years. Revenue from operations increased from ₹99.25 crore in FY24 to ₹121.89 crore in FY25, and further to ₹143.04 crore in FY26. This represents a Compound Annual Growth Rate (CAGR) of approximately 20.01% over the two-year period from FY24 to FY26. Profitability has also expanded, with Profit After Tax (PAT) rising from ₹4.53 crore in FY24 to ₹9.37 crore in FY25, and reaching ₹14.08 crore in FY26. The PAT margin improved to 9.84% in FY26 from 4.56% in FY24.
| Financial Year | Revenue from Operations (₹ Crore) | PAT (₹ Crore) | PAT Margin (%) |
|---|---|---|---|
| FY2024 | 99.25 | 4.53 | 4.56% |
| FY2025 | 121.89 | 9.37 | 7.66% |
| FY2026 | 143.04 | 14.08 | 9.84% |
Objects of the Issue
The IPO proceeds are earmarked for specific operational needs. A total of ₹33.60 crore from the fresh issue is allocated for funding working capital requirements. This capital will support trade receivables, trade payables, and margin money for Performance and Security Deposit Bank Guarantees across the company's three divisions: Electronics, Rotating Machines, and Contracts (EPC). Additionally, the company plans to utilize funds for general corporate purposes, capped at the lower of 15% of gross proceeds or ₹10 crore.
Operational Risks and Concerns
Despite the revenue growth, the financials indicate significant working capital intensity and cash flow constraints. Working capital requirements increased by approximately 94.10% over two years, rising from ₹6,128.87 lakhs in FY24 to ₹11,896.73 lakhs in FY26. Consequently, the company has reported negative cash flows from operations for all three years: ₹(1.47) crore in FY24, ₹(9.65) crore in FY25, and ₹(11.10) crore in FY26. As of 31-Mar-2026, total outstanding borrowings stood at ₹7,542.45 lakhs, with interest rates ranging from 7.55% to 18.75%.
Business Structure and Management
IC Electricals operates through three distinct divisions. The Electronics Division manufactures regulators, battery chargers, and control systems. The Rotating Machines Division produces alternators and traction motors, while the Contracts Division handles turnkey railway electrification projects. The company's manufacturing facility is located in Haridwar, Uttarakhand. The leadership team includes Mr. Sunil Kumar Verma as Managing Director and Mrs. Davisha Verma as Chief Financial Officer (CFO). The top 10 customers accounted for 50.38% of revenue in FY26, while the top 10 suppliers contributed 52.59% of purchases.
How will the company utilize the IPO proceeds to reduce its dependence on high-cost debt ranging up to 18.75%?
Can the company sustain its 20% revenue growth rate if the Ministry of Railways reduces its current 82% contribution to total revenues?
What strategies will management implement to reverse the trend of negative operating cash flows despite rising profits?
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