1. At a Glance
Mangal Electrical Industries wants to tap the wires of Dalal Street with a₹400 Cr all-fresh issue IPO. Price band: ₹533–₹561 per share, market cap ~₹1,550 Cr. They make transformers, CRGO coils, and other power equipment — basically the unsung heroes behind your “bijli bill.” FY25 was a blockbuster: revenue up 22%, PAT up 126%. Sounds electrifying — until you see post-IPO P/E ~33x. That’s not D-Mart expensive, but for a transformer company, it’s charged way above normal.
2. Introduction
Power sector companies usually fall into two buckets:
- Giants like NTPC who generate electricity and bore investors to sleep.
- Niche players like Mangal Electrical, who quietly manufacture the nuts and bolts — or in this case,transformers and CRGO coils— that keep the grid alive.
Founded in 2008, Jaipur-based Mangal isn’t a household name, but if you’ve ever switched on a fan during summer and not had a blackout, companies like this deserve partial credit. They produce transformers from 5 KVA to 10 MVA, assemble CRGO cores, make circuit breakers, and even take EPC contracts for substations.
IPO story? They want ₹101 Cr to repay debt, ₹88 Cr to expand capacity, and ₹122 Cr to buy more working capital (translation: raw material stockpiling). Promoter holding drops from100% → 74%. That’s healthy — promoters still retain majority control.
Financials show solid growth, but IPO pricing makes it smell more like a power cut during IPL finals — irritating.
3. Business Model (WTF Do They Even Do?)
In simple terms: Mangal Electrical makesequipment that distributes electricity.
Product lines:
- Transformers(distribution & small power transformers).
- CRGO coils, cores, assemblies(critical raw material for transformers).
- Amorphous cores(energy-efficient components).
- Oil-immersed circuit breakers.
- Trading in CRGO/CRNO coils and ribbons.
- EPC services for substations.
Manufacturing setup: 5 plants in Rajasthan, with hefty annual capacity — 10 lakh+ KVA transformers, 16,200 MT CRGO, 75,000 circuit breakers. They’re backward
and forward integrated, meaning they control much of the supply chain.
Customers? Power utilities, infra projects, EPC contractors. The kind of clients that pay late but keep coming back.
4. Financials Overview
| Metric | FY25 (Latest) | FY24 | FY23 | YoY % | 2Y CAGR % |
|---|---|---|---|---|---|
| Revenue | ₹551 Cr | ₹452 Cr | ₹358 Cr | +22% | +24% |
| EBITDA | ₹81.8 Cr | ₹42.6 Cr | ₹44.4 Cr | +92% | +36% |
| PAT | ₹47.3 Cr | ₹20.9 Cr | ₹24.7 Cr | +126% | +40% |
| EPS (₹) Pre | 23.08 | 10.2 | 12.0 | +126% | — |
| EPS (₹) Post | 17.12 | — | — | — | — |
👉Commentary: FY24 was shaky, but FY25 roared back with 2x profit. Margins improved, ROE hit ~29%. Impressive, but cyclical businesses like transformers often show lumpy results. Don’t assume this is the new normal.
5. Valuation (Fair Value Range Only)
- P/E Method:Post-issue EPS = ₹17.12.At ₹533–₹561 → P/E = 31.1x–32.8x.Peers (transformer/infra players) trade at 18–24x.
- EV/EBITDA Method:EBITDA FY25 = ₹81.8 Cr.EV ≈ Market Cap ₹1,550 Cr + Debt ₹149 Cr – IPO debt repayment = ~₹1,600 Cr.EV/EBITDA ≈ 19.6x. Sector average ~12–14x.
- DCF (10% growth, 12% WACC, 3% terminal)→ ~₹350–₹420/share.
🎯Fair Value Range (Educational only): ₹350–₹420/share.IPO at ₹533–₹561 = overheated transformer.
6. What’s Cooking – News, Triggers, Drama
- Capacity Expansion: New facility at Reengus, Sikar district (Rajasthan).
