Vivid Electromech IPO

Strengths

• ✓The company claims to operate integrated manufacturing facilities across Navi Mumbai and Pune, covering the entire production process from design to testing. This includes in-house fabrication, assembly, wiring, and testing, supported by CNC-based machinery and specialised equipment. Such integration is stated to reduce dependence on third-party vendors and provide greater control over production timelines.
• ✓The company has a diversified product portfolio across both low-voltage (LV) and medium-voltage (MV) segments, including panels up to 33 kV, busducts, and electrical goods. It also offers both standard and customised solutions based on client requirements. This enables it to cater to multiple sectors such as data centres, infrastructure, manufacturing, and power generation.
• ✓The company has established a presence in the data centre segment, which contributed approximately 35.80% of its total revenue in FY25. It provides panels designed for continuous power supply and reliability requirements specific to data centre operations.
• ✓The company claims to have strategic partnerships with established original equipment manufacturers (OEMs), such as ABB and Larsen & Toubro (L&T). It is authorised to manufacture specific type-tested panels like ABB’s ArTu K switchboards. These associations allow it to produce panels aligned with OEM specifications and industry standards.
• ✓The company is ISO 9001:2015 certified for quality management systems, ISO 14001:2015 certified for environmental management systems, and ISO 45001:2018 certified for occupational health and safety management systems. It claims to follow standardised quality control procedures, including in-house testing using specialised equipment such as high-voltage test kits and primary injection testing setups.
• ✓The company has seen a consistent increase in revenue from operations and profit after tax (PAT). Revenue from operations increased from Rs 59.32 crore in FY23 to Rs 88.91 crore in FY24 to Rs 155.29 crore in FY25, while PAT increased from Rs 0.06 crore in FY23 to Rs 4.28 crore in FY24 to Rs 20.24 crore in FY25.

Risks

• !The cost of raw materials forms a significant portion of the company’s expenses. The total cost of raw materials amounted to Rs 100.24 crore (77.94% of total cost), Rs 60.62 crore (72.43%), and Rs 50.22 crore (84.27%) in FY25, FY24, and FY23, respectively. Fluctuations in raw material prices or the inability to pass on increased costs to customers could be detrimental to the company's business.
• !The top 10 suppliers of the company contributed Rs 87.01 crore (73.00%), Rs 42.43 crore (67.35%), and Rs 37.28 crore (73.27%) to total purchases in FY25, FY24, and FY23, respectively. Failure to maintain relationships with these suppliers or secure alternate sources of supply could adversely affect the company’s operations and cost structure.
• !The top 10 customers of the company contributed Rs 108.55 crore (69.90%), Rs 49.01 crore (55.12%), and Rs 36.83 crore (62.08%) to revenue from operations in FY25, FY24, and FY23, respectively. Any failure to retain these key customers or a reduction in order volumes from them can adversely affect the company’s revenues and financial standing.
• !A significant portion of the company’s revenue is concentrated in Maharashtra, contributing Rs 133.18 crore (85.94%), Rs 45.50 crore (51.21%), and Rs 32.35 crore (54.54%) in FY25, FY24, and FY23, respectively. Any adverse political, social, or economic developments in this region can negatively impact the company’s business and operations.
• !The company is in the process of setting up a new manufacturing facility with an estimated project cost of Rs 66.73 crore. Any delay in execution, cost overruns, or failure to achieve expected capacity utilisation can adversely affect the company’s financial condition and growth prospects.
• !As of March 31, 2025, the company has total trade receivables amounting to Rs 60.55 crore. Any failure to collect these receivables on time or at all can negatively impact the business and its financial condition.
• !The company is dependent on OEM partnerships such as ABB and L&T for certain product offerings. Any adverse changes in these arrangements, including non-renewal or stricter terms, can negatively impact the company’s product portfolio and revenues.
• !The company, its subsidiaries, promoters, and directors are involved in certain ongoing legal proceedings. Any adverse judgments in any of these cases could be detrimental to the company’s business prospects.
• !The company’s manufacturing operations are concentrated in two facilities located in Maharashtra. Any disruption at these facilities due to power issues, natural events or state-specific issues can adversely affect production and order fulfilment.
• !As of March 31, 2025, the company had outstanding financial indebtedness of Rs 18.74 crore. Any failure to service or repay these loans can harm the company’s operations and finances

About Vivid Electromech

Vivid Electromech Limited is engaged in the manufacturing of low-voltage (LV) and medium-voltage (MV) electrical panels and automation systems. The company undertakes panel manufacturing and system integration, providing services across engineering, design, fabrication, assembly, testing, and commissioning of control and automation systems. Its product portfolio includes PCC panels, MCC panels, IMCC panels, DG synchronisation panels, power distribution boards, outdoor panels, and MV panels ranging from 3.3 kV to 36 kV, along with specialised panels such as VFD panels, control and relay panels, and APFC panels. These products are used in sectors such as data centres, infrastructure, metro projects, renewable energy, and industrial manufacturing. The company operates two manufacturing facilities located in Navi Mumbai and Pune, Maharashtra. The Navi Mumbai facility handles end-to-end manufacturing processes, while the Pune unit focuses on assembly operations. The company primarily generates revenue from domestic sales, with a limited contribution from exports.