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The ₹1,100 crore initial public offering (IPO) of Powerica Ltd., a Mumbai-based power solutions provider, will open for subscription on March 24 and close on March 27.
Powerica has fixed a price band of ₹375 to ₹395 per share. Retail investors can bid for one lot of 37 shares, translating into a minimum investment of ₹14,615. Bids can be made in multiples of 37 shares thereafter. Eligible employees will receive a discount of ₹37 per share.
In the grey market, Powerica's shares are commanding a flat GMP. However, it is important to note that grey market premiums are only an indicator of demand in the unlisted market and can change rapidly.
At the upper end of the price band, the company is likely to command a post-issue market capitalisation of ₹4,998.6 crore.
Should you apply?
SBI Securities has recommended a 'Subscribe' rating on the issue for the long term.
At the upper price band, the IPO is valued at 19.4x annualised FY26 earnings on a post-issue basis. While revenue grew at a modest CAGR of 5.6% between FY23 and FY25, growth has picked up in FY26, the brokerage said. Demand for diesel generator sets remains strong, led by data centres and backup power applications.
The company also has long-term relationships with Cummins, Hyundai, Schneider Electric, GE Vernova and Vestas.
At the higher price band, the company is seeking pre- and post-money P/E multiples of 27.2x and 31.7x, respectively, which are at a discount to peers. However, with near debt-free operations following the utilisation of IPO proceeds, the adjusted pre- and post-money P/E multiples stand at around 23x and 26x, respectively.
The brokerage considers this valuation attractive for a company delivering essential power solutions and services, and has therefore assigned a 'Subscribe' rating.
Risk factors
- Segment concentration: During FY23, FY24, FY25 and H1FY26, the company derived 82.8%, 86.3%, 85.0% and 80.5% of its revenue, respectively, from the generator set business. Any adverse development in this segment could impact overall performance.
- Collaboration-dependent business model: The company relies heavily on partnerships for critical components and services. It depends on Cummins for engines and alternators for DG sets, and on Hyundai for MSLG sets.
- IPP business dependence: The IPP segment relies on OEM relationships for supply of components and O&M services across wind projects. Key suppliers include Vestas Wind Technology India and GE Renewable R&D India.
- PPA-land lease mismatch: Some land lease agreements for wind projects have shorter tenures than the corresponding PPAs. Non-renewal of such leases could lead to premature termination of PPAs.
Powerica IPO structure
Powerica's IPO comprises a fresh issue of ₹700 crore and an offer for sale (OFS) of ₹400 crore.
The OFS size has been reduced from ₹700 crore earlier, while the total IPO size stood at ₹1,400 crore in the draft red herring prospectus filed in August last year. The draft papers were approved by SEBI in December 2025.
Of the total issue, 50% is reserved for qualified institutional bidders (QIBs), 15% for non-institutional investors, and 35% for retail investors.
Powerica IPO objective
The company plans to utilise ₹525 crore from the fresh issue towards debt repayment, with the remaining funds earmarked for general corporate purposes. As of February 2026, its total outstanding borrowings stood at ₹1,214.25 crore.
Powerica began its diesel generator sets business in 1984 and expanded into medium-speed large generators (MSLG) in 1996. It currently offers generator sets ranging from 7.5 kVA to 10,000 kVA.
Its business includes diesel generator sets powered by Cummins engines, MSLG offerings in collaboration with Hyundai, and allied activities.
The company derived over 80.5% of its revenue from the generator set division, with the remainder coming from the wind power segment. It reported a profit of ₹129 crore for the six months ended September 2025 on revenue of ₹1,447.44 crore.
For FY25, profit declined 26.3% to ₹166.8 crore from ₹226.3 crore in the previous year, largely due to a drop in other income to ₹57.7 crore from ₹146.8 crore. Revenue, however, rose 20% to ₹2,653.3 crore from ₹2,210 crore.
ICICI Securities, IIFL Capital and Nuvama Wealth Management are the book-running lead managers for the issue, while MUFG Intime India is the registrar.
The allotment is expected on March 30, and the stock is likely to list on the bourses on April 2.
