The electrical equipment sector in India is projected to experience a twofold increase in its size in the coming seven years, with its market value anticipated to hit the $130 billion mark by 2030. According to projections, India’s consumer electronics and appliances market will grow to the fifth-largest globally by the year 2025. With the steady growth of this sector, companies like Rulka Electricals are making their mark.
Rulka Electricals, known for its quality electrical products, is preparing for its initial public offering (IPO). The anticipation surrounding this IPO is considerable. With a solid track record of profitability, the company has made a name for itself in the electrical industry.
The aim of this article is to provide a comprehensive overview of the Rulka Electricals IPO, offering readers valuable insights into the company’s background, financial standing, and the potential impact of this IPO on the market.
Rulka Electricals IPO details
The Initial Public Offering is designed as a book-built issue, accumulating a total of ₹26.40 crores. This includes a fresh issuance of 8.42 lakh shares, which collectively amount to ₹19.80 crores. Additionally, there’s an offer-for-sale component that includes 2.81 lakh shares, contributing ₹6.60 crores to the total.
Also read: NFO or IPO – What do you think is the better option?
Important Dates
| Particulars | Date |
| Subscription open | May 16 |
| Subscription close | May 21 |
| Listing date | May 24 |
Source: RHP – Rulka Electricals Limited
The Initial Public Offering is expected to be listed on the NSE SME platform, with a provisional listing date of May 24, 2024.
Must read: What sets an SME IPO apart from a regular IPO?
The initial public offering (IPO) of Rulka Electricals Limited has a price range set from ₹223 to ₹235 per share. This range signifies the lowest and highest price at which investors can place their bids for the shares during the Initial Public Offering. The minimum number of shares an investor can apply for is 600 shares.
Through the fresh offer of Rulka Electricals’ IPO, the company plans to allocate the raised funds towards fulfilling multiple goals. These include meeting the requirement of working capital, serving general corporate purposes, and covering the expenses related to the offer. This strategic allocation of funds is designed to fuel the company’s growth and operational efficiency.
Rulka Electricals Pvt Ltd
Established on May 30, 2013, Rulka Electricals has carved a niche for itself in the realm of turnkey project contracting. The company excels in delivering all-encompassing solutions for a wide range of electrical and firefighting turnkey projects.
The company boasts various services, including electrical solutions, electrical panels, solar EPC contracts, turnkey electrical warehousing projects and many services catering to commercial and industrial electrical requirements.
Furthermore, it provides services such as maintenance, electrical contracting, and the installation of data and voice cabling, catering to a variety of sectors including industrial, commercial, retail, and theatre. The company excels in delivering electrical contracting services for a broad spectrum of industrial facilities.
Rulka Electricals takes great pride in its enduring relationships with respected clients, including D’mart, Oberoi Hotels, Reliance Retail, Radisson Group, Welspun One Logistics, Mastek, Indospace and Inox.
Moving forward, the company is focusing its efforts on obtaining orders on a larger scale. It has broadened its service offerings to include PA systems, CCTV Servicing, Audio-Video systems, IT Networking, Solar System Services, and Security systems, demonstrating its commitment to growth and innovation.
Financial position of Rulka Electricals Ltd
Key financial metrics of the Rulka Electricals Ltd are as follows:
| For the period endedFebruary 29, 2024(in ₹lakhs) | For the year ended March 31, 2023(in ₹lakhs) | |
| Share capital | 341.60 | 11.00 |
| Net worth | 1290.15 | 557.33 |
| Total revenue | 6527.77 | 4,689.78 |
| Profit after tax | 565.77 | 280.52 |
| Earnings per share | 16.67 | 8.50 |
| Net asset value per share (₹) (Pre bonus) | 37.77 | 506.67 |
| Net asset value per share (₹) (Post bonus) | 37.77 | 16.89 |
| Total borrowings | 1104.89 | 527.07 |
Source: RHP – Rulka Electricals Limited
Must read: A simple guide to understanding NAV in mutual funds
Risks and strengths
Risks
- The company’s operations are largely dependent on a select group of clients, and any decrease or significant cutback in contracts from these clients could adversely affect the company’s business.
- Ongoing projects may potentially face increased costs or experience delays.
- As part of its routine operations, the company is required to secure and renew specific authorisations and licences. Failure to successfully acquire or renew these registrations could negatively affect the company’s operations, financial results, and overall financial health.
- A substantial part of the company’s income from operations originates from India. Consequently, any adverse events impacting operations in India could negatively influence the company’s business, financial health, and operational outcomes.
- The company, including its directors and promoters, are currently engaged in legal proceedings. Any unfavourable outcome in these proceedings could have a substantial negative effect on the company’s business, operational results, and financial condition.
Strengths
- Rulka Electricals is dedicated to providing top-notch services and holds an ISO certification. It maintains rigorous quality standards from the start of a project, giving it a competitive advantage and leading to repeat orders from numerous customers.
- The company has managed to retain its esteemed clients due to its solid reputation. These ongoing relationships result not only in recurring business but also offer a competitive edge in attracting new customers.
- Rulka Electricals caters to a varied range of end markets across multiple industry sectors, such as warehouse, retail, industrial, and hotel/hospital clients. The company’s wide-ranging clientele allows it to counterbalance a substantial portion of the rise in operational expenses.
- The business model of Rulka Electricals emphasises the optimal use of resources, skill development, and client satisfaction. This model has demonstrated its effectiveness and scalability, enabling the company to expand into various sectors while maintaining a consistent quality of services.
- The promoters and directors of the company bring extensive experience in the power industry and have been pivotal in the company’s development. Their active participation in operations and their visionary leadership have been key to maintaining the company’s business operations.
Bottomline
Rulka Electricals IPO represents a significant event in the financial landscape. The company’s dedication to excellence, robust customer connections, varied clientele, expandable business structure, and seasoned leadership team equip it well for potential expansion.
