Raksan Transformers IPO

Subscription Status

GMP History

Strengths

• ✓The company operates two manufacturing facilities in Rai, Sonepat, Haryana, with a combined area of approximately 3,037.5 sq. mtrs. It claims to have in-house capabilities for core cutting/slitting, wire or strip drawing, tank fabrication, product designing and testing, which reduces its dependence on third parties for certain manufacturing processes.
• ✓As of June 30, 2026, the company had 83 orders in hand with an aggregate order book of Rs 329.68 crore. The order book comprises orders for transformers and provides visibility into the company’s pending business.
• ✓The company had around 121 customers as of March 31, 2026, including government entities, power utilities, EPC contractors, and industrial customers. It is also an approved vendor for more than 20 entities, including power distribution corporations, public sector undertakings, and public utility companies.
• ✓The company is ISO 9001:2015 certified for quality management systems at both its manufacturing facilities. It also has BIS approval for transformers with capacities of up to 2,500 KVA and BEE certification for Level 2/3 energy efficiency ratings.
• ✓Its promoter, Sanjeev Kanda, has around 31 years of experience in the transformer industry and has been involved in the company’s establishment, manufacturing operations, and expansion. The management team is also supported by directors, key managerial personnel and senior management with experience in transformer manufacturing, finance and regulatory compliance.
• ✓The company reported growth in revenue from operations from Rs 160.95 crore in FY24 to Rs 324.21 crore in FY25 and Rs 363.11 crore in FY26. During the same period, PAT increased from Rs 7.59 crore to Rs 20.38 crore and Rs 33.60 crore, while EBITDA margin improved from 6.33% in FY24 to 12.87% in FY26.

Risks

• !A substantial portion of the company’s revenue comes from government and public utility customers, which contributed Rs 184.19 crore (50.73%), Rs 236.63 crore (72.99%), and Rs 90.34 crore (56.13%) to revenue from operations in FY26, FY25, and FY24, respectively. Any reduction in orders, delays in tendering, changes in government policies or budget allocations, or delays in payments from these customers could adversely affect the company’s revenue, profitability, order book, and cash flows.
• !A significant portion of the company’s revenue is generated through competitive bidding for contracts from government and public sector entities, with B2G revenue contributing 50.73%, 72.99%, and 56.13% of revenue from operations in FY26, FY25, and FY24, respectively. The company abstained from bidding for three consecutive tenders by Paschimanchal Vidyut Vitran Nigam Limited in June 2019. Inability to qualify for or win future tenders, increased pricing pressure, changes in eligibility criteria, or restrictions on bidding could adversely affect its order book, margins, and financial performance.
• !The company depends on a limited number of suppliers for its raw materials, with its top 10 suppliers accounting for 54.96% of total raw material procurement in FY26, compared with 63.22% in FY25 and 63.48% in FY24. Raw material consumption amounted to Rs 291.15 crore (80.18% of revenue from operations) in FY26, Rs 270.89 crore (83.55%) in FY25 and Rs 138.62 crore (86.13%) in FY24. The company does not have long-term supply agreements with its suppliers, and any disruption in supply or increase in raw material prices could adversely affect its production, margins, and financial performance.
• !The company derives a significant portion of its revenue from distribution transformers of up to 3,150 KVA, which contributed Rs 233.03 crore (64.18%), Rs 223.99 crore (69.09%), and Rs 137.08 crore (85.17%) to revenue from operations in FY26, FY25, and FY24, respectively. Any demand reduction, changes in procurement policies, delays in electrification projects, or a shift in customer preference towards other types of transformers could adversely affect the company’s revenue, operating margins, and financial condition.
• !The company derives a significant portion of its revenue from its top 10 customers, which accounted for 71.49%, 82.82%, and 83.52% of revenue from operations in FY26, FY25, and FY24, respectively. The top five customers contributed Rs 168.34 crore (46.36%), Rs 243.41 crore (75.08%), and Rs 109.55 crore (68.07%) during the same periods. Any loss of key customers, reduction in order volumes, or changes in their supplier base could adversely affect the company’s revenue, profitability, and cash flows.
• !The net cash used in investing activities amounted to Rs 11.19 crore in FY26, compared with an outflow of Rs 22.55 crore in FY25 and Rs 7.42 crore in FY24. The cash outflows during the year were largely for capital expenditure on property, plant and equipment of Rs 7.62 crore and capital work-in-progress of Rs 3.65 crore, reflecting the company's continued investment in capacity expansion and infrastructure. These outflows were partially offset by interest income of Rs 0.33 crore, movement in other non-current assets of Rs 1.87 crore, and proceeds from redemption of mutual funds. While these investments could potentially bring in more business, revenues, and profit in the future, investors should monitor these to see whether they generate the expected returns and translate into improved operating performance.
• !The company derives a significant portion of its revenue from Uttar Pradesh and Bihar. Revenue from Uttar Pradesh stood at Rs 212.65 crore (58.56%), Rs 241.86 crore (74.60%), and Rs 100.20 crore (62.26%) in FY26, FY25, and FY24, respectively, while revenue from Bihar stood at Rs 51.63 crore (14.22%), Rs 12.03 crore (3.71%), and Rs 0.48 crore (0.30%), respectively. Any adverse economic, regulatory, or market developments in these states could adversely affect the company’s business and financial performance.
• !The company’s revenue is subject to seasonal fluctuations due to the timing of government tenders and delivery schedules, which may be affected by budget allocations and administrative approvals. Revenue from operations in Q4 accounted for 41.77%, 35.98%, and 42.72% of total revenue in FY26, FY25 and FY24, respectively, amounting to Rs 151.66 crore, Rs 116.66 crore, and Rs 68.75 crore, while in the other quarters it was much lesser.
• !As of June 30, 2026, the company had total outstanding financial indebtedness of Rs 32.66 crore. A significant portion of its borrowings is secured against its industrial properties and current assets. Failure to service or repay these borrowings could adversely affect the company’s financial position and may result in enforcement of the underlying security.

About Raksan Transformers

Raksan Transformers is an ISO 9001:2015 certified company, which manufactures transformers across different voltage ratings. Its product portfolio includes distribution transformers, power transformers, transformers for solar applications, and special purpose transformers, which are used in power generation, transmission and distribution networks, and various industrial and infrastructure projects. The company began operations in 1995, initially providing repair and servicing of distribution and power transformers, and started manufacturing transformers in 2005-06. As of March 31, 2026, the company operates two manufacturing facilities at HSIIDC Industrial Estate, Rai, District Sonepat, Haryana, with a combined area of approximately 3,037.5 sq. mtrs. The facilities have an installed production capacity of approximately 1,500,000 KVA for distribution transformers and 1,350 MVA for power transformers. The company also has a backward integration arrangement through its group company, SHR Powers Private Limited, which manufactures transformer tanks and bodies used in its production. Use of proceeds: The IPO consists of both a fresh issue of shares and an offer for sale (OFS).​ Proceeds from the OFS will go to the respective selling shareholders, whereas the net proceeds from the fresh issue will be utilised for the following purposes:​ Funding capital expenditure towards setting up a manufacturing facility at Liwaspur, Distt. Sonepat, Haryana — Rs 62.14 crore To meet working capital requirements — Rs 35 crore Repayment of certain borrowing availed by the company, in part or full — Rs 7.28 crore General corporate purposes