1. At a Glance
HPL Electric, one of India’s oldest electrical brands, is lighting up investor radars with smart meter orders worth ₹3,500 Cr and FY25 profits hitting ₹94 Cr. But at 41x PE and receivables stuck like old ceiling fans, is this spark sustainable?
2. Introduction with Hook
Imagine plugging your charger in, but it keeps falling out. That’s been HPL’s investor story for years — full of potential, but slippery in delivery.
- FY25 PAT: ₹94 Cr (Up 113%)
- Order book: ₹3,500 Cr+ in smart meters
- Stock CAGR (3Y): 116%
This isn’t a sleepy wires-and-switches business anymore. This is a “Make-in-India + Power Sector Revamp + CapEx Buzz” combo that just might stay plugged in this time.
3. Business Model (WTF Do They Even Do?)
HPL makes pretty much everything that runs on volts:
- Meters – Smart, digital, prepaid. Huge tender pipeline.
- Modular Switches – The stuff you click with attitude.
- Switchgear – The industrial backbone.
- LED Lighting – 5th largest in India.
- Wires & Cables – For homes, factories & transformers.
Revenue mix is balanced, with meters leading thanks to India’s energy digitization push (hello, DISCOM reforms!). Customers include state utilities, EPC contractors, retail, and export clients in 42+ countries.
4. Financials Overview
FY25 Performance:
| Metric | FY25 | FY24 |
|---|---|---|
| Revenue (₹ Cr) | 1,700 | 1,461 |
| EBITDA (₹ Cr) | 255 | 193 |
| EBITDA Margin | 15% | 13% |
| Net Profit (₹ Cr) | 94 | 44 |
| ROCE (%) | 14.4% | 11% |
| ROE (%) | 10.8% | 6.8% |
Solid growth. Double-digit ROCE return for the first time in years. Margin expansion shows they’re not just chasing revenue but also quality orders.
5. Valuation
- PE Ratio: ~41.6x
- Book Value: ₹142
- CMP / BV: 4.25x
- Fair Value Estimate Range: ₹480 – ₹640
- Valuation Method: PE of 30–40x on FY26E EPS (₹16–₹20)
Valuation’s toasty, but not overpriced given the scale-up in smart metering and OPM improvement.
6. What’s Cooking – News, Triggers, Drama
- Massive Order Book: ₹3,500 Cr smart meter orders; largest in company history.
- CapEx Plans: ₹100 Cr for FY26 to expand smart meter production capacity.
- Partnerships: Collaboration with Wirepas for in-meter IoT gateway = tech push.
- Recurring Ratings Love: CRISIL & India Ratings both gave ‘Positive’ outlook upgrades.
- Government Push: DISCOM smart meter tenders rising. PLI and infra reforms = long-term tailwinds.
7. Balance Sheet
| Item | FY25 (₹ Cr) |
|---|---|
| Equity Capital | 64 |
| Reserves | 851 |
| Borrowings (Total) | 639 |
| Trade Receivables | 714 |
| Inventory | 697 |
| Net Block | 498 |
| CWIP | 8 |
| Total Assets | 2,095 |
Key Points:
- Receivables still sticky (~153 days).
- Debt is rising to fund expansion (but manageable).
- Assets rising with factory upgrades and tech investments.
8. Cash Flow – Sab Number Game Hai
| Year | CFO (₹ Cr) | CFI (₹ Cr) | CFF (₹ Cr) | Net CF (₹ Cr) |
|---|---|---|---|---|
| FY25 | 138 | -70 | -66 | 2 |
| FY24 | 100 | -39 | -72 | -11 |
| FY23 | 104 | -40 | -74 | -10 |
Key Points:
- Operating cash finally positive despite WC challenges.
- Consistent CapEx spend over last 3 years.
- Financing activity mostly loan-related. Minimal dilution.
9. Ratios – Sexy or Stressy?
| Ratio | FY25 | FY24 |
|---|---|---|
| ROCE (%) | 14.4 | 11.0 |
| ROE (%) | 10.8 | 6.8 |
| Debtor Days | 153 | 174 |
| Inventory Days | 230 | 218 |
| Cash Conversion Cycle | 241 | 276 |
Verdict: Improving, but still not party-ready. Working capital is still a chokepoint.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | PAT | OPM % | NPM % |
|---|---|---|---|---|---|
| FY25 | 1,700 | 255 | 94 | 15% | 5.5% |
| FY24 | 1,461 | 193 | 44 | 13% | 3.0% |
| FY23 | 1,262 | 157 | 30 | 12% | 2.3% |
Trend: Operating and net margins rising. Company is not just growing — it’s maturing.
11. Peer Comparison
| Company | CMP (₹) | P/E | ROE % | OPM % | PAT (₹ Cr) | Sales (₹ Cr) |
|---|---|---|---|---|---|---|
| Kaynes Tech | 5,851 | 133 | 11.0 | 15.0 | 293 | 2,722 |
| Jyoti CNC Auto | 1,020 | 71.8 | 21.2 | 27.0 | 322 | 1,818 |
| Syrma SGS Tech | 703 | 72.9 | 10.2 | 8.5 | 171 | 3,787 |
| HPL Electric | 606 | 41.6 | 10.8 | 15.0 | 94 | 1,700 |
Verdict: Not the cheapest, not the fastest. But among the few profitable mid-sized plays in smart metering.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: 72.66% (rock solid)
- Public Holding: 26.33%
- FII Holding: Just 0.7% (small, but rising)
- DIIs: Negligible (room to grow)
- No. of Shareholders: 1.4+ lakh (doubling in 2 years)
Promoters aren’t selling, FIIs are nibbling, and retail love is rising. Not bad at all.
13. EduInvesting Verdict™
HPL is a “low-voltage hero in a high-voltage market”. It’s got the orders, the brand, and finally — the margins. But cash flow stress and working capital bloat are the electric elephants in the room.
If it can tame receivables and scale smart metering faster than Tata Power or Genus, it could go from “meh” to megawatt. Until then — watch this switch with your eyes open and fingers grounded.
Metadata
– Written by EduInvesting Research | 18 July 2025
– Tags: Smart Meters, Electrical Equipment, HPL Electric, Wires, Modular Switches, Infra CapEx, Power Sector
