Kanohar Electricals Limited, a Meerut-based transformer manufacturer with over 40 years of experience, has filed its Draft Red Herring Prospectus (DRHP) for an initial public offering. The company is raising ₹219.19 crore through a fresh issue to expand manufacturing capacity and meet working capital requirements.

About the Company

Kanohar Electricals manufactures power, traction, Scott, and distribution transformers, alongside shunt reactors. It also operates an Engineering, Procurement & Construction (EPC) business for substations and transmission lines. The company is one of only five in India certified for 500 MVA 400 kV transformers. It serves sectors including power transmission, railways, and renewable energy, with marquee clients such as Power Grid Corporation of India Limited (POWERGRID).

Financial Performance

Revenue from operations grew at a compound annual growth rate (CAGR) of 53.72% from ₹276.69 crore in FY2024 to ₹653.84 crore in FY2026. Profit after tax (PAT) surged to ₹129.73 crore in FY2026, up from ₹17.76 crore in FY2024. EBITDA reached ₹180.42 crore in FY2026.

As of March 31, 2026, the company held an order book of ₹1,818.32 crore. Outstanding borrowings stood at ₹385.56 crore as of July 31, 2026.

Why the Company Is Raising Funds

The proceeds from the fresh issue will be utilized as follows:

• Working Capital: ₹155.00 crore for incremental working capital requirements.
• Capacity Expansion: ₹40.00 crore for new machinery and equipment.
• Office Building: ₹12.04 crore for civil construction at the Gangol facility.
• Sustainability: ₹12.15 crore for solar power plants and electric vehicles.
• General Corporate Purposes: Balance of gross proceeds.

Business Strengths

• Certification: One of five Indian companies certified for 500 MVA 400 kV transformers.
• Market Position: Leading domestic player by revenue in FY2026.
• Order Book: Strong visibility with ₹1,818.32 crore in orders as of March 2026.
• Integration: Backward-integrated manufacturing facilities in Meerut with 19,200 MVA capacity.

Key Risks

• Customer Concentration: Top 10 customers contributed 93.16% of revenue in FY2026.
• Government Dependence: 85.37% of revenue came from government entities; bid-to-win ratio was 20% in FY2026.
• Debarment History: Temporarily debarred by Bihar State Power Transmission Company Limited in February 2026.
• Capacity Utilization: Utilization was 45.99% in FY2026, though improved from 29.70% in FY2025.

Important IPO Dates

• IPO Opening Date: 08-Sep-2026
• IPO Closing Date: 10-Sep-2026
• Allotment Date: 11-Sep-2026
• Listing Date: 16-Sep-2026

Offer Details

• Issue Type: Fresh Issue
• Total Fresh Issue Size: ₹219.19 crore (quantified components)
• Offer for Sale: None

Bottom Line

Kanohar Electricals presents a high-growth profile with strong revenue expansion and niche certification advantages. However, investors note significant concentration risks regarding customers and government tenders, alongside substantial working capital needs funded by the IPO.