Highlights
| Issue Size – 27,848,100 shares | Issue Open/Close – 24 Mar / 27 Mar, 2026 |
| Price Band (Rs.) 375 – 395 | Issue Size (Rs.) ~ 11,000 mn |
| Face Value (Rs) 5 | Lot Size (shares) 37 |
Powerica Limited, incorporated in 1984, is a power solutions company that specializes in diesel generator sets (DG sets) for main and backup use, with power ranging from 7.5 kVA to 10,000 kVA, designed to meet the distinctive requirements of diverse industries and applications.
The company manufactures DG sets along with auxiliary items, including acoustic enclosures, fuel and exhaust systems, and customized control panel systems, with offerings comprising high-speed generator solutions powered by Cummins engines ranging from 7.5 kVA to 3750 kVA in LHP, MHP, and HHP categories and medium-speed large generators via collaboration with HD Hyundai Heavy Industries Co., Limited, ranging from 3000 kVA to 11,000 kVA.
Powerica entered the wind power sector in 2008 as an independent power producer (IPP) and subsequently developed capabilities as an EPC and O&M service provider for balance of plant (BOP). The company owns 12 operational wind power projects with a total installed capacity of 330.85 MW and a 52.70 MW project under construction.
Out of the total proceeds from the offer of Rs. 11,000 mn, ~Rs. 5,250 mn would go towards debt repayment and ~Rs. 1,750 mn would go towards general corporate purposes. While ~Rs. 4,000 mn would go towards existing selling shareholders of the company.
Key Highlights
- India’s DG industry is deeply interlinked with the country’s industrialization, urban expansion, and digital infrastructure development, with a market size of Rs. 144 bn in FY25 and expected to grow to Rs. 238 bn by FY30, clocking a CAGR of 10.5 percent, fuelled by infrastructure development, telecom expansion, IT/data centers, commercial growth, and the continued need for power reliability in Tier II and Tier III cities.
- Powerica operates 3 manufacturing facilities for the generator set business division located in Bengaluru, Silvassa, and Khopoli, with a consolidated installed capacity for DG sets being 10,276 units per year, PRISMA Control Panels at 3,000 units per year, and 1,800 canopies per year.
- The company owns 12 operational wind power projects in its IPP portfolio with an aggregate installed capacity of 330.85 MW, a 52.7 MW project under construction, 3 projects summing up to 250 MW of wind power capacity, and 30 MW of solar power capacity in its pipeline.
- The company’s core strategies include (i) (i) capitalizing on continued demand for generator sets, (ii) continuing to develop its wind power business and diversifying further into wind-solar hybrid projects, (iii) continuing to develop its allied businesses and RECD business through its associate, (iv) further developing and strengthening its alliances to improve its position in India, and (v) continuously evaluating expansion opportunities, considering policy and consumer base attractiveness.
- Sales of the company grew 20.1 pct YoY from Rs. 22,100 mn in FY24 to Rs. 26,532 in FY25, with EBITDA taking a hit in FY25 due to the higher cost of raw material; it came at Rs. 3,366 mn in FY25 against Rs. 3,624 mn in FY24, and the EBITDA margin shrank 371 bps to 12.69 pct in FY25 from 16.4 pct in FY24. The company reported a profit of Rs. 1,168 in FY25 against Rs. 2,262 mn in FY24, which was lower due to higher other income in FY24.
Key Risk
- The company relies on collaboration with Cummins engines and Hyundai for engines and alternators for its DG sets and supply of MSLG sets. Any supply disruption from such partners could adversely impact its business and results of operations.
- If power evacuation facilities are not made available by the time their IPP power projects are ready to commence operations, they may incur significant transmission costs or may be forced to back down from the grid, and their operations could be adversely affected.
- The delay between making significant upfront investments in its wind power projects and receiving revenue could materially and adversely affect its business, cash flows, financial condition, and results of operations.
Financial Performance
| (In Rs. million, unless otherwise stated) | FY23 | FY24 | FY25 | H1FY26 |
| Revenue from Operations | 23783 | 22100 | 26533 | 14474 |
| EBITDA | 3474 | 3625 | 3366 | 2137 |
| EBITDA Margin % | 14.6% | 16.4% | 12.7% | 14.8% |
| Profit | 1065 | 2263 | 1168 | 1289 |
| Profit Margin % | 4.5% | 10.2% | 4.4% | 8.9% |
| ROE % | N/A | 26.5 | 17.5 | 11.6 |
| ROCE % | N/A | 43.5 | 27.0 | 13.9 |
Peer Comparison
| Peer Comparison | Powerica | KOEL | Cummins |
| Sales (Mn) | 26,533 | 63,957 | 108,376 |
| EBITDA (Mn) | 3,366 | 11,917 | 23,468 |
| EBITDA Margin % | 12.7% | 18.6% | 21.7% |
| Profit (Mn) | 1,168 | 4,758 | 19,999 |
| Profit Margin % | 4.4% | 7.4% | 18.5% |
| ROE % | 18.8% | 16.7% | 28.2% |
| ROCE % | 19.4% | 16.7% | 62.8% |
Valuation
Powerica Limited is an integrated power solutions provider engaged in manufacturing and supplying diesel generator sets (DG sets), medium-speed large generators (MSLG), and related services, catering to primary and standby power requirements across industries. At the upper end of the price of Rs. 395, the issue quotes a PE of 19.4x on FY26 annualized earnings. The issue looks fully priced. One can subscribe to this issue from a longer-term perspective.
Disclaimer: The views shared in blogs are based on personal opinions and do not reflect the company’s views. Investment involves risk, and it is advisable to consult a financial advisor before making any investment through the app. The decision to invest is solely that of the investor, and the company or its communication cannot be held responsible for it.
