1. At a Glance
IKIO Technologies, a smallcap LED OEM-turned-technovator, boasts of design-led LED dominance and a subsidiary spree. But FY25 net profit halved, ROE is falling, and Q4 was a literal blackout. Is this a pause before the surge—or just a dimmer switch on investor returns?
2. Introduction with Hook
Imagine sprinting up a hill in LED-lit sneakers, only to twist your ankle at the top. That’s IKIO in FY25. After riding high post-IPO and flexing ODM muscles, the company slammed into a wall of falling margins, CFO exits, and a Q4 net loss.
- FY25 PAT: ₹32 Cr vs ₹61 Cr in FY24 (down 48%)
- Stock down ~30% from highs
- Q4FY25: Net loss ₹-0.67 Cr
Investors lit the fuse. But did the spark go out?
3. Business Model (WTF Do They Even Do?)
IKIO is an ODM (Original Design Manufacturer)—designs, develops, and manufactures products under clients’ brands, primarily in:
- LED Lighting – core cash cow
- Electronic Components & Solutions
- Smart Lighting (IoT)
- Appliances (foray via subsidiaries)
They now have 1,000+ SKUs across B2B and industrial customers. Notable moves:
- JV with Ritech Holdings (UAE)
- PLI Approval for LED incentives
- Acquisition spree via IKIO Solutions
4. Financials Overview
| Year | Revenue (₹ Cr) | OPM% | PAT (₹ Cr) | ROCE | ROE |
|---|---|---|---|---|---|
| FY22 | 332 | 23% | 51 | 41% | 20% |
| FY23 | 359 | 22% | 50 | 31% | 19% |
| FY24 | 438 | 21% | 61 | 22% | 13% |
| FY25 | 486 | 12% | 32 | 8% | 6% |
Narrative:
Growth in topline, collapse in bottomline. Margins halved. ROE and ROCE have dimmed dramatically.
5. Valuation
| Metric | Value |
|---|---|
| CMP | ₹210 |
| Market Cap | ₹1,620 Cr |
| Book Value | ₹72.5 |
| PE (TTM) | 52.4x |
| P/B | 2.89x |
Fair Value Estimate:
- Base Case (PE 25x, EPS ₹4.5) → ₹112
- Bull Case (PE 35x, EPS ₹6) → ₹210
- Bear Case (PE 15x, EPS ₹3) → ₹45
Fair Value Range: ₹45 – ₹210
→ Currently priced at peak optimism, despite earnings dip.
6. What’s Cooking – News, Triggers, Drama
- New CEO Sanjeet Singh appointed May 2025
- PLI Scheme approval for LEDs (via IKIO Solutions)
- Noida factory went live in June 2024
- Ritech Holdings (UAE) fully acquired
- CFO resignation in May 2024 (ouch)
- Q4FY25 net loss, margins lowest ever at 5.5%
Lots of flash, but FY25 was a dim year.
7. Balance Sheet
| Particulars | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | ₹65 Cr | ₹77 Cr | ₹77 Cr |
| Reserves | ₹77 Cr | ₹476 Cr | ₹483 Cr |
| Borrowings | ₹123 Cr | ₹70 Cr | ₹53 Cr |
| CWIP | ₹27 Cr | ₹72 Cr | ₹44 Cr |
| Fixed Assets | ₹65 Cr | ₹106 Cr | ₹205 Cr |
Key Takeaways:
- Debt halved = ✅
- Massive capex (fixed assets doubled)
- IPO proceeds partly deployed into subsidiaries
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹57 | ₹-47 | ₹-8 | ₹2 |
| FY24 | ₹-5 | ₹-249 | ₹266 | ₹12 |
| FY25 | ₹35 | ₹-4 | ₹-33 | ₹-2 |
Translation:
FY24 IPO cash was spent fast, CFO is volatile, FY25 saw FCF recovery but still weak liquidity.
9. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE | 31% | 22% | 8% |
| ROE | 19% | 13% | 6% |
| Debtor Days | 74 | 81 | 85 |
| Inventory Days | 191 | 191 | 180 |
| CCC | 227 | 241 | 221 |
Verdict:
Margins and returns are sliding. Working capital is tight and getting tighter.
10. P&L Breakdown – Show Me the Money
| Year | Sales | EBITDA | OPM% | PAT |
|---|---|---|---|---|
| FY23 | ₹359 | ₹78 | 22% | ₹50 |
| FY24 | ₹438 | ₹93 | 21% | ₹61 |
| FY25 | ₹486 | ₹60 | 12% | ₹32 |
Q4FY25 margins: 5.5%
→ Either costs exploded or pricing collapsed.
11. Peer Comparison
| Company | Sales (Cr) | PAT (Cr) | ROCE | PE | OPM% | Mcap (Cr) |
|---|---|---|---|---|---|---|
| Dixon Tech | 38,860 | 774.5 | 39% | 124x | 3.8% | ₹96,561 Cr |
| PG Electroplast | 4,869 | 287.8 | 19% | 80x | 9.9% | ₹22,926 Cr |
| Cellecor Gadg. | 1,025 | 30.9 | 24% | 25x | 5.3% | ₹786 Cr |
| IKIO | 486 | 32 | 8% | 52x | 12% | ₹1,620 Cr |
→ Expensive valuation for a company with declining performance.
12. Miscellaneous – Shareholding, Promoters
| Holder Type | Jun 2023 | Jun 2024 | Mar 2025 |
|---|---|---|---|
| Promoters | 72.46% | 72.50% | 72.50% |
| FIIs | 5.06% | 0.71% | 0.61% |
| DIIs | 7.21% | 5.12% | 1.69% |
| Public | 15.27% | 21.68% | 25.20% |
- Institutional exodus post-FY24
- Retail holding surged
- Promoters stable but no buying despite correction
13. EduInvesting Verdictâ„¢
IKIO is not your regular lighting company. It designs, manufactures, builds, and experiments. Its growth ambition is real—with PLI wins, factory launches, and international ventures.
But FY25 results showed us the flip side: margin compression, net loss in Q4, and capital-intensive operations.
It’s an execution story, not a valuation one yet. If they deliver on margins and scale the new capacities, the upside can spark back.
But for now, the fuse is lit. Let’s hope it leads to a celebration—and not a fizzle.
Metadata
– Written by EduInvesting Team | 20 July 2025
– Tags: IKIO Technologies, LED Manufacturing, ODM, Smallcap Electronics, IPO Watch, Lighting Stocks
