Powerica IPO opens today for subscription, with the integrated power solutions provider looking to raise Rs 1,100 crore from the primary market.
The price band for the issue has been set at Rs 375 to Rs 395 per equity share, with the offer consisting of a fresh issue of Rs 700 crore and an offer for sale component worth Rs 400 crore by existing promoters.
Powerica seeks to use approximately Rs 525 crore of the fresh proceeds to repay or prepay the company's outstanding borrowings, a move aimed at leaner operations as the brand looks to scale its wind and solar hybrid projects.
The company's core value proposition is deeply tied to its four-decade-old relationship with Cummins India Ltd. As a key Original Equipment Manufacturer for Cummins, Powerica specialises in diesel generator sets that range from 7.5 kVA to 3,750 kVA, providing critical standby power for industries that cannot afford a second of downtime.
Powerica IPO: Should You Subscribe?
SBI Securities has come out with a note on Powerica IPO, highlighting India's data centre capacity, which is projected to grow at a CAGR of 27.4% through 2030. The firm believes this could serve as a massive tailwind for Powerica's generator business.
Although revenue growth between 2023 and 2025 has been modest, the company has had a significant pickup in the first half of FY26, notably reporting a profit of Rs 129 crore.
As far as valuations are concerned, SBI Securities notes that at the upper end of the price bank, the IPO is valued at 19.4x it annualised FY26 earnings. This sits at a steep discount compared to industry peers such as Cummins India and Kirloskar Oil Engines, which trade at 65.5x and 47x, respectively.
Keeping that in mind, SBI Securities has issued a 'Subscribe for Long-Term' recommendation on the Powerica IPO.
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