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Industry : Compressors, Pumps & Diesel Engines

Powerica Limited View all IPOs

Price Band

Rs 375 – Rs 395

Powerica Limited is going public with a fresh issue and an offer for sale. The issue opens on 24th March 2026.

MOJO CALL

Why

Avoid

MOJO CALL

Avoid

Neutral

Four-Decade OEM Partnership with Cummins and a Full-Spectrum Product Portfolio

Powerica's non-exclusive OEM relationship with Cummins India, sustained for over 40 years, is a significant competitive moat. As one of Cummins' preferred manufacturing partners, the company benefits from access to premium engines, joint product forecasting, and collaborative go-to-market strategies. This relationship is not easily replicable by newer entrants and has helped Powerica consistently defend its position in the MHP and HHP DG set segments.

Wind Power Business Backed by Long-Term, Fixed-Tariff PPAs with Creditworthy Counterparties

Powerica's 330.85 MW operational wind portfolio in Gujarat is underpinned by 25-year fixed-tariff PPAs with GUVNL (rated "AA" by CARE) and SECI (rated "AAA" by ICRA), providing high revenue visibility and minimal offtake risk. The weighted average remaining life of these PPAs stands at 18 years, which is a strong long-term anchor for the Wind Power Business. The company has maintained average plant availability consistently above 98% and average external grid availability above 99% across all reported periods.

Land Lease Mismatches in Wind Power Projects and Execution Risks

A notable structural risk in the Wind Power Business is that several land lease agreements for operational wind projects have shorter tenures than their corresponding PPAs. If these leases are not renewed on acceptable terms, the relevant PPAs could be terminated prematurely, putting contracted revenues at risk.

Stretched Valuations with Limited Upside

Based on the FY2025 financials, the company is seeking a market-to-sales valuation of 1.88x and a price-to-earnings ratio of 28.4x. With the Wind Power business providing consistent cashflow, the business model is largely limited to assembling DG sets, with key components sourced from engine manufacturers such as Cummins. Accordingly, we recommend avoiding the issue.

Issue Details

Issue Opens	24th March 2026
Issue Closes	27th March 2026
Price Band	Rs 375 – Rs 395
Issue size (Upper Band)	Rs. 1100 crore
Issue Type	FRESH ISSUE & OFFER FOR SALE
Market cap (based on upper band)	Rs 4988.60 crore
Sales- March 2025 (Rs./Crs)	Rs. 2653.27 Cr
Net Profit - March 2025 (Rs./Crs)	Rs. 175.83 Cr
Industry	Compressors, Pumps & Diesel Engines
Promoters	BHARAT OBEROI, RENU NARESH OBEROI, JAI RAM OBEROI, NARESH OBEROI FAMILY TRUST, BHARAT OBEROI FAMILY TRUST AND KABIR AND KIMAYA FAMILY PRIVATE TRUST
Lead Manager	ICICI Securities, IIFL Capital and Nuvama Wealth Management

Objective of the Issue

Details

Objectives of the Issue – Fresh Issue: Rs 700 crore & Offer for Sale: Rs 400 crore

1. Prepayment/repayment of certain outstanding borrowings availed by the company, in part or full – Rs 525 crore

2. General Corporate Purposes – Rs 175 crore

List of Shareholders Selling Their Stake

Name	Type	Value of Shares (in Rs)	% of OFS
Naresh Oberoi Family Trust	Promoter	2,80,00,00,000	70%
Kabir and Kimaya Family Private Trust	Promoter	1,20,00,00,000	30%

Business Operations

About Company

Powerica Limited is an integrated power solutions provider incorporated in 1984 and headquartered in Mumbai, Maharashtra. The company specialises in diesel generator (DG) sets for both primary and standby power applications, offering a comprehensive product range from 7.5 kVA to 10,000 kVA.

As one of the original equipment manufacturers (OEMs) for Cummins India Limited — a relationship spanning over four decades — Powerica designs, manufactures, supplies, installs, and commissions DG sets powered by Cummins engines. It also offers Medium Speed Large Generators (MSLG) in collaboration with HD Hyundai Heavy Industries, catering to high base load and continuous process applications.

The company operates three manufacturing facilities across Bengaluru, Silvassa, and Khopoli, and serves diverse sectors including commercial real estate, healthcare, data centres, infrastructure, manufacturing, and government. Building on its generator set expertise, Powerica entered the wind power sector in 2008 as an independent power producer and has since developed capabilities in EPC contracting and O&M services for wind power projects.

Segment Revenue Breakup

Revenue Breakdown by Segment:
Segment	H1 FY2026	FY2025	FY2024
Generator Set Business	80.5%	85%	86.3%
Wind Power Business	19.5%	15%	13.7%

Financials

Financial Overview

The company's revenue grew at a CAGR of 5.62% between FY2023 and FY2025, with revenues of Rs 2,653 crore recorded for FY2025. For H1 FY2026, the company recorded revenues of Rs 1,447 crore.

For FY2025, the company's Operating Profit (EBITDA) stood at Rs 345.7 crore, compared to Rs 362.45 crore and Rs 333.2 crore recorded in FY2024 and FY2023, respectively. For H1 FY2026, EBITDA stood at Rs 220.4 crore, with margins of 15.23%.

Consequently, the company recorded profits of Rs 175.83 crore in FY2025, compared to Rs 226.11 crore and Rs 106.45 crore recorded in FY2024 and FY2023, respectively. For H1 FY2026, the company recorded profits of Rs 134.55 crore, with margins of 9.12%.

The company has managed to successfully generate positive cashflow from operations (CFO) for the past 3 years. The company generated CFO of Rs 247.4 crore for FY2025. Similarly, the company has generated positive operating cashflows of Rs 283.4 crore and Rs 252.2 crore for FY2024 and FY2023, respectively.

As of 30th September 2025, the company recorded borrowings (incl. lease liabilities) of Rs 587 crore.

Financial Performance (Rs/crore)

Rs./Crs	H1 FY2026	FY2025	FY2024
Sales	1447.44	2653.27	2210.00
Net Profit	134.55	175.83	226.11