MV Electrosystems Ltd IPO
Status: Closed
Overview
IPO date
30 Jul 2026 to 03 Aug 2026
Face value
₹ 5 per share
Price
₹ 400 to ₹425 per share
Issue Size
6,823,528 shares
(aggregating up to ₹ 290 Cr)
(aggregating up to ₹ 290 Cr)
Allotment Date
04 Aug 2026
Listing at
NSE
Issue type
Book Building
Sector
Consumer Durables
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T&C*
Strengths vs Risks of MV Electrosystems Ltd
Know the pros & cons
Strengths
- Engineering and systems design focused railways company with strong in-house research, design & development capabilities for highly engineered and complex railway systems, combining precision and domain expertise.
- Ability to create precision driven design & development capabilities and safety critical & complex railway electric equipment acts as high barriers to entry in this segment.
- Long-standing and deep relationship with Indian Railways.
- Experienced Promoter and management team with strong implementation skills and operational effectiveness.
Risks
- We are dependent on and derive a substantial portion of our revenue from a limited number of customers. Further, Indian Railway, through is various units or workshops, has been the single largest customer of our Company and constituted 76.72%, 72.96% and 67.80% of our revenue from operations during the Financial Years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively. Cancellation of orders, if any, by customers or delay or reduction in their orders could have a material adverse effect on our business, results of operations and financial condition.
- Any delay or failure in obtaining, renewing or maintaining statutory and regulatory approvals, or non-compliance with applicable laws, could adversely affect our business and operations.
- Our existing assembling cum manufacturing facility, Research, Design & Development Centre and the location where existing cable protection & interconnected products facility is proposed to be shifted, all are situated in the state of Haryana. Concentration of all the facilities in the state of Haryana, India, may expose us to regional risks that could adversely affect our business, results of operations, financial condition, and cash flows.
- We are in the process of shifting operations for existing cable protection & interconnected products facility from Village Baghola, Palwal, Haryana, India ("Unit 1"), where it is presently situated, to Nangla Bhiku, Pawal, Haryana, India ("Unit 2") and installing new machinery for 3-Phase Propulsion Equipment, and any delays, cost overruns or execution failures may adversely affect our business and financial condition.
- Our revenue from operations have been constant in the past as our Company focused on the development of 3-Phase Propulsion Equipment. Our Company has received significant purchase orders aggregating to Rs. 7,376.60 million (excluding GST and AMC) for supply of 450 (four hundred fifty) 3-Phase Propulsion Equipment during the Financial Year ended March 31, 2026. Any inability to execute these orders in accordance with their terms, including with respect to production capacity, working capital requirements, operational execution, delivery schedules, quality standards or warranty and maintenance obligations, may have a material adverse effect on our business, financial condition, results of operations, cash flows and future prospects.
- The determination of the Price Band and Issue Price is based on various factors and assumptions and the Issue Price may not be indicative of the Market Price of the Equity Shares after the Issue. Further, there are no listed companies that is of similar size of our operations and also undertake the production of propulsion equipment and therefore qualitative or quantitative peer comparison cannot be undertaken. Also, the current market price of securities of one of the company listed pursuant to previous issue managed by the BRLM is below its issue price.
- Certain Equity Shares have been issued by our Company and transferred by our Promoter and Promoter Group shareholders in the secondary sale (as detailed below) during the preceding one year at prices (as proportionately adjusted for the split of face value of Equity Shares of ? 10 each to ? 5 each) that may be lower than the Issue Price.
- We have experienced negative cash flows from operating activities during the Financial Year ended March 31, 2026 and March 31, 2024 and may experience similar earnings declines or operating losses or negative cash flows from operating activities in the future.
- Most of our customer orders generally contains a liquidated damage charges clause for delay or non delivery of the products. In the past, we have incurred additional costs or liquidated damages for an amount of Rs. 4.07 million, Rs. 2.52 million and Rs. 0.47 million during the Financial Years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively and may also incur similar cost in the event of disputes, claims, defects or delays in future, which could adversely affect our business, financial condition, profitability and cash flows.
- We rely on imports from certain countries for certain raw material for our present products. Further, for 3-Phase Propulsion Equipment, we will import raw material or electronic components from countries, such as China, UK, Hong Kong & Singapore and also source imported raw material from local suppliers / office of such foreign suppliers. Supplies of such imports / imported materials may be disrupted by changes in government regulations or policies, deterioration in economic conditions or escalation of trade tensions and any changes in the pricing and quality of our raw material / components including Insulated Gate Bipolar Transistors, capacitors, semiconductors, micro processors, thyristor, etc could cause significant disruptions to and adversely impact our business operations.
- We depend on third party suppliers for primary requirement of raw materials which are on a purchase order basis. Further, the costs of the raw materials which we use in our assembling cum manufacturing process are subject to volatility in prices in domestic and international market/s. Such suppliers may not perform, or be able to perform their obligations in a timely manner, or at all and any delay, shortage, interruption, reduction in the supply of or volatility in the prices of raw materials on which we rely may have a material adverse effect on our business, results of operations, financial condition, cash flows and future prospects.
- There have been certain discrepancies in the past in relation to statutory compliances or filings required to be made by it, as well as there are certain other non-compliances / delays by the Company. Consequently, its may be subject to regulatory actions and penalties for any such non-compliance and the company business, financial condition and reputation may be adversely affected.
- The company has certain contingent liabilities that have not been provided for in its financial statements, which if they materialise, may adversely affect the company financial condition.
- The company does not have certain documents evidencing the biographies and / or educational qualifications of certain of its Promoters, Directors, Key managerial Personnel and Senior Management Personnel and have relied on the statement of marks and provisional certificate / affidavits submitted by such personnel for details of their profile included under the section "the company Management" of the Red Herring Prospectus.
- Anonymous complaints have been received against the Company subsequent to the filing of the Draft Red Herring Prospectus, and any regulatory scrutiny, investigation or adverse outcome arising therefrom may adversely affect the company's business, reputation, financial condition and results of operations.
- The company is undertaking research, design & development activities to develop and obtain approvals of new propulsion systems / projects required by Indian Railways and requires significant expenditure and capital outlay, which may not yield the intended results in a timely manner or at all, and adversely affect the company's financial condition and results of operations.
- The Company requires substantial working capital and working capital projections made by the Company are based on its management's assumptions. The company may requires alternate funding in Financial Year ending March 31, 2027 and March 31, 2028 post utilization of the Net Proceeds and if the Company is unable to raise sufficient working capital, the operations of the Company will be adversely affected.
- The company funding requirements and proposed deployment of the Net Proceeds have not been appraised by any bank or financial institution and may be subject to change based on various factors, some of which are beyond its control.
- Information relating to the installed capacity, actual production and capacity utilization of the company's assembling and manufacturing facilities included in the Red Herring Prospectus is based on various assumptions and estimates, and future production and capacity may vary. If the company is unable to maintain the existing level of capacity utilization at its assembling and manufacturing facility, the company margins and profitability may be adversely affected. Further, a slowdown or shutdown in its assembling and manufacturing operations could have an adverse effect on the company's business, results of operations, financial condition and cash flows.
- The Company's Directors, its Promoters, Key Managerial Personnel and Senior Managerial Personnel are party to certain legal and regulatory proceedings. These legal and regulatory proceedings are pending at different levels of adjudication before various courts and regulatory authorities. Any adverse decision in such proceedings may have a material adverse effect on its business, financial condition, cash flows and results of operations.
- Appeal against the adjudication order issued by Registrar of Company in the matter of failures to open a separate bank account for receipt of the share application money and utilisation thereof prior to the allotment of equity shares by Group Company, namely Quadrant Future Tek Limited, which is a non compliance under Section 42 of the Companies Act.
- In one instance in the past, the Company has returned raw materials / components imported by it back to the Indian subsidiary of the supplier without giving intimation or obtaining prior approval from the Reserve Bank of India under the provisions of the Foreign Exchange Management Act, 1999 and the applicable rules and regulations issued thereunder. Imposition of penalty for not obtaining such approval may have an adverse effect on the company's results of operations, financial condition and cash flows
- In the past, the Company had instances involving payments made on behalf of and received from certain Group Companies aggregating to 0.05%, 0.86% and 0.02% of the revenue from operations for the financial years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively. Such transactions were appropriately accounted for in the financial statements, which post such adjustment reflect true and fair view of the financial position. This indicated deficiencies in certain internal control processes for which remedial measures have been implemented by the Company, but there can be no assurance that similar instances will not occur in the future.
- There are certain delays in payment of statutory dues by the company. Any further delay / default in payment of statutory dues may attract financial penalties and / interest on delayed payments from the respective government authorities and in turn may have a material adverse impact on its financial condition and cash flows.
- The company do business with its customers on purchase order basis or through tenders issued by them from time to time and does not have long-term contracts with most of them. Further, the company's business tends to vary from quarter to quarter based on the timing of release of various tenders and successful award of purchase orders to it based on the terms of the tender.
- The company has incurred indebtedness and an inability to comply with repayment and other covenants in its financing agreements could adversely affect the company's business and financial condition. Under its financing arrangements, the company is required to obtain the prior, written lender consent for, among other matters, changes in its capital structure, formulate a scheme of amalgamation or reconstruction and entering into any other borrowing arrangement. Further, any breach of terms under the company financing arrangements or its inability to meet the company obligations, including financial and other covenants under its debt financing arrangements could adversely affect the company's business and financial condition.
- Any future acquisitions, strategic investments and entries into new products that are used in conjunction with propulsion equipment could disrupt the company's business, divert its management's attention and harm the company's business.
- The company requires a significant amount of capital and the company future capital needs may requires it to obtain additional loans and borrowings or issue equity or debt securities, which may impose restrictions on the company's business activities and dilute its shareholders' equity. Further, failures to obtain additional financing on terms commercially acceptable to it may adversely affect the company ability to grow and the company's future profitability.
- The company is subject to strict quality requirements, customer inspections and audits, and any failures to comply with quality standards or faulty equipment may lead to product recall, corrective actions due to defects in its products or not meeting the specified level of performance / quality, cancellation of existing and future orders and could negatively impact the company reputation, its business, results of operations and future prospects.
- The company Key Managerial Personnel, Senior Management Personnel and other qualified personnel, including employees at Research, Design & Development Centre are critical to its continued success and the company may experience disruptions to its business if the company is unable to retain such personnel or attract new such personnel in the future.
- The company is exposed to the risk of loss of confidential technical knowledge which includes trade secrets, assembling and manufacturing processes, and other confidential information critical to its operations.
- Certain investors were previously granted special rights under a Shareholders' Agreement and Securities Subscription Agreement, which have since been terminated, and any adverse regulatory interpretation in relation to such arrangements or their subsequent re-classification as Promoter / Promoter Group may impact the Company.
- Technological advancements in railway propulsion and power electronics systems could render the company existing products less competitive or obsolete which may adversely affect its business, results of operations and ability to participate in new tenders issued by Indian Railways.
- The company's employees may engage in misconduct or other improper or illegal activities, including misrepresentation, non-compliance with regulatory requirements and breach of contractual obligations.
- The company depends on the timely availability of labour for its operations including engagement of contract workers for carrying out certain functions of the company's business operations. In the event of its inability to control the cost of the company labour force or non-availability of such contract workers at reasonable cost, any adverse regulatory orders or any default on payments to them by the agencies could lead to disruption of the manufacturing facilities and its business operations.
- Any failures of the company's software and information technology systems could adversely affect its business and operations. An actual or perceived cybersecurity or privacy breach could interrupt the company operations, harm its brand and adversely affect the company's reputation, brand, business, financial condition and results of operations.
- The company faces significant competition from domestic and international rail power electronics equipment manufacturers, which may lead to a difficulty for it to gain market share or growth, which in turn may adversely affect the company's business, results of operations, financial condition and cash flows.
- The threats and challenges in the power electronics equipment and cable protection & interconnect products in railway industry may have a material adverse effect on the company's business, financial condition, cash flows and results of operations.
- In future, its may be required to create warranty reserve and any insufficiency of the company warranty reserves to cover future warranty claims could have an adverse impact on its financials.
- The company uses heavy equipment & machinery and high power load at its assembling cum manufacturing facilities and Research, Design & Development centre which could cause bodily harm and accidents, which in turn could adversely impact the company operations.
- The company operations may be disrupted to breakdown of machinery at its units, labour unrest, slowdowns and increased wage costs, lead to prolonged outage of operations which may have a material adverse effect on the company's business, financial condition and results of operations. which may adversely affect its business, results of operations and financial condition.
- The company depends on adequate and uninterrupted availability of power for its operations, and any failures to do so may have an adverse impact on the company operations.
- Its may be negatively impacted by any early obsolescence of the company assembling cum manufacturing equipment and the spare parts used in such equipment.
- Its may not be successful in implementing the company's business strategies. Any failures to raise additional financing could have an adverse effect on its business, results of operations, financial condition and cash flows.
- The company relies on third-party transportation providers for both procurement of its raw materials and delivery of the company final products to customers. Disruption in transportation or failures by any of its transportation providers to deliver the company raw materials or its products on time, or in good condition, or at all, may adversely affect the company's business, financial condition and results of operations.
- The company has entered into, and will continue to enter into, related party transactions that may involve conflict of interest.
- Its may be subject to exchange rate fluctuations, which could materially and adversely impact the company's business, financial condition and results of operations.
- The company is exposed to interest rate risks because the company has borrowed funds at floating interest rates. Any changes in its interest rates could increase the company borrowing costs and in turn impact its profitability.
- The company relies primarily on insurance policies to insure its operations-related risks. If the company's insurance coverage is inadequate, it may have an adverse effect on its business, financial condition and results of operations.
- Failures to renew the company's leases agreements, or secure new leases for its Unit 1, Research, Design & Development centre, Registered cum Corporate office and the proposed new Research, Design & Development centre for which short term agreement has been executed could cause business disruptions.
- Some of the company Directors may not have experience as directors of companies listed on recognised stock exchanges in India.
- Certain sections of the Red Herring Prospectus contain information from the CareEdge Report which the company commissioned and paid for and any reliance on such information for making an investment decision in the Issue is subject to inherent risks.
- After the completion of the Issue, its Promoters along with the Promoter Group will continue to collectively hold substantial shareholding in the Company.
- Any variation in the amount of the Net Proceeds proposed to be utilised towards the objects as stated in the Red Herring Prospectus would be subject to certain compliance requirements, including prior Shareholders' approval.
- Its cannot assure payment of dividends on the Equity Shares in the future and the company ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements, capital expenditures and restrictive covenants of its financing arrangements.
- The company track certain operational metrics and non-generally accepted accounting principles, measures with internal systems and tools and does not independently verify such metrics. Certain of its operational metrics are subject to inherent challenges in measurement and any real or perceived inaccuracies in such metrics may adversely affect the company's business and reputation.
MV Electrosystems Ltd Peer Comparison
Understand the company’s industry standing
MV Electrosystems Ltd
Hind Rectifiers Limited
Face Value
5
2
Standalone / Consolidated
Standalone
Consolidated
Total Income Rs. Cr.
49.43
999.13
EPS-Basis
-6.52
13.1
EPS-Diluted
-6.52
13.05
NAV Per Share
30.58
60.69
P/E-Basic EPS
---
88.83
P/E-Diluted EPS
---
---
RONW(%)
-20.29
21.37
Latest NAV Period
---
---
Latest NAV
---
---
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The IPO opens on 30 Jul 2026 & closes on 03 Aug 2026.
MV Electrosystems Limited was originally incorporated as MV Electrosystems Private Limited' on July 03, 2009 at Delhi as private limited company. Subsequently, Company was converted into a public limited company and a fresh certificate of incorporation dated November 26, 2021 was issued by the RoC.
Presently, Company is engaged in the design, development, assembly and manufacturing of electrical & power electronics equipment used in railway rolling stock including IGBT based 3-Phase Drive Propulsion equipment for electric locomotives, switchgear panels for railway coaches & EMU's, cable protection & management products and electrical components, systems & sub-systems.
The Company was founded by Mohit Vohra, the Founder Promoter with focus on railway industry. The Company began production for cable protection & interconnected products at Unit I in 2018. The Company advanced into higher-value engineering by initiating the indigenous design and development of propulsion equipment, a core system integral to locomotive performance in FY20. It supplied 3-Phase Propulsion Equipment to CLW and commissioned for service trials by West Central Railways in 2023. Further, it completed trial run of 50,000 km for the 3-Phase Propulsion Equipment supplied by the Company to CLW, Indian Railways and received final inspection certificate in 2024. The Company has entered into a Business Cooperation Agreement with PNC Technologies Co. Ltd., South Korea for period of three years, to collaborate exclusively for the manufacturing, supply and distribution of Auto Fault Locator system for 25 KV Rail over-head electrification line across the country. This marks the entry into the Rail electrical infrastructure products.
The Company is now a part of the ongoing transformation in India's rail infrastructure, driven by the Government of India's focus on 100% electrification of broad-gauge routes, Make-in-India procurement mandates, and the expansion of railway network, including introduction of high speed trains. The Company is focused towards research, design & development of electrical equipment & power electronics systems for usage in railways industry and to play a strategic role as a domestic manufacturer with technical, indigenous designed and developed propulsion equipment and in-house assembling cum manufacturing facilities. The ingenious in-house design & development of 3-Phase Propulsion Equipment for 6000 HP Locomotive is a key achievement of Company to create various other energy efficient railway power conversion systems. Such developments requires expertise in multiple domains including, Electrical Engineering, Embedded Design, Software Development, Mechanical Engineering, Thermal Design & Instrumentation.
The Company launched the IPO, which comprised a fresh issue of 68,23,528 Equity shares having the face value of Rs 5 each and raised Rs 290 crore on August 03, 2026.
.
MV Electrosystems Ltd IPO will close on 03 Aug 2026.
- Engineering and systems design focused railways company with strong in-house research, design & development capabilities for highly engineered and complex railway systems, combining precision and domain expertise.
- Ability to create precision driven design & development capabilities and safety critical & complex railway electric equipment acts as high barriers to entry in this segment.
- Long-standing and deep relationship with Indian Railways.
- Experienced Promoter and management team with strong implementation skills and operational effectiveness.
| S.No | Promoters Name | Pre Issue Shares | Pre Issue Percentage | Post Issue Shares | Post Issue Percentage |
|---|---|---|---|---|---|
| 1 | Mohit Vohra | 5886108 | 28.77 | 5886108 | 21.57 |
| 2 | Amit Dhawan | 1066086 | 5.21 | 1066086 | 3.91 |
| 3 | Sumit Dhawan | 1413934 | 6.91 | 1413934 | 5.18 |
| 4 | Rahul Dhawan | 2001160 | 9.78 | 2001160 | 7.33 |
| 5 | Sonali Dhawan | 1462632 | 7.15 | 1462632 | 5.36 |
| 6 | Ramendra Pratap Singh | 2081232 | 10.17 | 2081232 | 7.63 |
| 7 | Sangeeta Singh | 1824768 | 8.92 | 1824768 | 6.69 |
| 8 | Avinash Mehta | 1280 | 0.01 | 1280 | --- |
- We are dependent on and derive a substantial portion of our revenue from a limited number of customers. Further, Indian Railway, through is various units or workshops, has been the single largest customer of our Company and constituted 76.72%, 72.96% and 67.80% of our revenue from operations during the Financial Years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively. Cancellation of orders, if any, by customers or delay or reduction in their orders could have a material adverse effect on our business, results of operations and financial condition.
- Any delay or failure in obtaining, renewing or maintaining statutory and regulatory approvals, or non-compliance with applicable laws, could adversely affect our business and operations.
- Our existing assembling cum manufacturing facility, Research, Design & Development Centre and the location where existing cable protection & interconnected products facility is proposed to be shifted, all are situated in the state of Haryana. Concentration of all the facilities in the state of Haryana, India, may expose us to regional risks that could adversely affect our business, results of operations, financial condition, and cash flows.
- We are in the process of shifting operations for existing cable protection & interconnected products facility from Village Baghola, Palwal, Haryana, India ("Unit 1"), where it is presently situated, to Nangla Bhiku, Pawal, Haryana, India ("Unit 2") and installing new machinery for 3-Phase Propulsion Equipment, and any delays, cost overruns or execution failures may adversely affect our business and financial condition.
- Our revenue from operations have been constant in the past as our Company focused on the development of 3-Phase Propulsion Equipment. Our Company has received significant purchase orders aggregating to Rs. 7,376.60 million (excluding GST and AMC) for supply of 450 (four hundred fifty) 3-Phase Propulsion Equipment during the Financial Year ended March 31, 2026. Any inability to execute these orders in accordance with their terms, including with respect to production capacity, working capital requirements, operational execution, delivery schedules, quality standards or warranty and maintenance obligations, may have a material adverse effect on our business, financial condition, results of operations, cash flows and future prospects.
- The determination of the Price Band and Issue Price is based on various factors and assumptions and the Issue Price may not be indicative of the Market Price of the Equity Shares after the Issue. Further, there are no listed companies that is of similar size of our operations and also undertake the production of propulsion equipment and therefore qualitative or quantitative peer comparison cannot be undertaken. Also, the current market price of securities of one of the company listed pursuant to previous issue managed by the BRLM is below its issue price.
- Certain Equity Shares have been issued by our Company and transferred by our Promoter and Promoter Group shareholders in the secondary sale (as detailed below) during the preceding one year at prices (as proportionately adjusted for the split of face value of Equity Shares of ? 10 each to ? 5 each) that may be lower than the Issue Price.
- We have experienced negative cash flows from operating activities during the Financial Year ended March 31, 2026 and March 31, 2024 and may experience similar earnings declines or operating losses or negative cash flows from operating activities in the future.
- Most of our customer orders generally contains a liquidated damage charges clause for delay or non delivery of the products. In the past, we have incurred additional costs or liquidated damages for an amount of Rs. 4.07 million, Rs. 2.52 million and Rs. 0.47 million during the Financial Years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively and may also incur similar cost in the event of disputes, claims, defects or delays in future, which could adversely affect our business, financial condition, profitability and cash flows.
- We rely on imports from certain countries for certain raw material for our present products. Further, for 3-Phase Propulsion Equipment, we will import raw material or electronic components from countries, such as China, UK, Hong Kong & Singapore and also source imported raw material from local suppliers / office of such foreign suppliers. Supplies of such imports / imported materials may be disrupted by changes in government regulations or policies, deterioration in economic conditions or escalation of trade tensions and any changes in the pricing and quality of our raw material / components including Insulated Gate Bipolar Transistors, capacitors, semiconductors, micro processors, thyristor, etc could cause significant disruptions to and adversely impact our business operations.
- We depend on third party suppliers for primary requirement of raw materials which are on a purchase order basis. Further, the costs of the raw materials which we use in our assembling cum manufacturing process are subject to volatility in prices in domestic and international market/s. Such suppliers may not perform, or be able to perform their obligations in a timely manner, or at all and any delay, shortage, interruption, reduction in the supply of or volatility in the prices of raw materials on which we rely may have a material adverse effect on our business, results of operations, financial condition, cash flows and future prospects.
- There have been certain discrepancies in the past in relation to statutory compliances or filings required to be made by it, as well as there are certain other non-compliances / delays by the Company. Consequently, its may be subject to regulatory actions and penalties for any such non-compliance and the company business, financial condition and reputation may be adversely affected.
- The company has certain contingent liabilities that have not been provided for in its financial statements, which if they materialise, may adversely affect the company financial condition.
- The company does not have certain documents evidencing the biographies and / or educational qualifications of certain of its Promoters, Directors, Key managerial Personnel and Senior Management Personnel and have relied on the statement of marks and provisional certificate / affidavits submitted by such personnel for details of their profile included under the section "the company Management" of the Red Herring Prospectus.
- Anonymous complaints have been received against the Company subsequent to the filing of the Draft Red Herring Prospectus, and any regulatory scrutiny, investigation or adverse outcome arising therefrom may adversely affect the company's business, reputation, financial condition and results of operations.
- The company is undertaking research, design & development activities to develop and obtain approvals of new propulsion systems / projects required by Indian Railways and requires significant expenditure and capital outlay, which may not yield the intended results in a timely manner or at all, and adversely affect the company's financial condition and results of operations.
- The Company requires substantial working capital and working capital projections made by the Company are based on its management's assumptions. The company may requires alternate funding in Financial Year ending March 31, 2027 and March 31, 2028 post utilization of the Net Proceeds and if the Company is unable to raise sufficient working capital, the operations of the Company will be adversely affected.
- The company funding requirements and proposed deployment of the Net Proceeds have not been appraised by any bank or financial institution and may be subject to change based on various factors, some of which are beyond its control.
- Information relating to the installed capacity, actual production and capacity utilization of the company's assembling and manufacturing facilities included in the Red Herring Prospectus is based on various assumptions and estimates, and future production and capacity may vary. If the company is unable to maintain the existing level of capacity utilization at its assembling and manufacturing facility, the company margins and profitability may be adversely affected. Further, a slowdown or shutdown in its assembling and manufacturing operations could have an adverse effect on the company's business, results of operations, financial condition and cash flows.
- The Company's Directors, its Promoters, Key Managerial Personnel and Senior Managerial Personnel are party to certain legal and regulatory proceedings. These legal and regulatory proceedings are pending at different levels of adjudication before various courts and regulatory authorities. Any adverse decision in such proceedings may have a material adverse effect on its business, financial condition, cash flows and results of operations.
- Appeal against the adjudication order issued by Registrar of Company in the matter of failures to open a separate bank account for receipt of the share application money and utilisation thereof prior to the allotment of equity shares by Group Company, namely Quadrant Future Tek Limited, which is a non compliance under Section 42 of the Companies Act.
- In one instance in the past, the Company has returned raw materials / components imported by it back to the Indian subsidiary of the supplier without giving intimation or obtaining prior approval from the Reserve Bank of India under the provisions of the Foreign Exchange Management Act, 1999 and the applicable rules and regulations issued thereunder. Imposition of penalty for not obtaining such approval may have an adverse effect on the company's results of operations, financial condition and cash flows
- In the past, the Company had instances involving payments made on behalf of and received from certain Group Companies aggregating to 0.05%, 0.86% and 0.02% of the revenue from operations for the financial years ended March 31, 2026, March 31, 2025 and March 31, 2024 respectively. Such transactions were appropriately accounted for in the financial statements, which post such adjustment reflect true and fair view of the financial position. This indicated deficiencies in certain internal control processes for which remedial measures have been implemented by the Company, but there can be no assurance that similar instances will not occur in the future.
- There are certain delays in payment of statutory dues by the company. Any further delay / default in payment of statutory dues may attract financial penalties and / interest on delayed payments from the respective government authorities and in turn may have a material adverse impact on its financial condition and cash flows.
- The company do business with its customers on purchase order basis or through tenders issued by them from time to time and does not have long-term contracts with most of them. Further, the company's business tends to vary from quarter to quarter based on the timing of release of various tenders and successful award of purchase orders to it based on the terms of the tender.
- The company has incurred indebtedness and an inability to comply with repayment and other covenants in its financing agreements could adversely affect the company's business and financial condition. Under its financing arrangements, the company is required to obtain the prior, written lender consent for, among other matters, changes in its capital structure, formulate a scheme of amalgamation or reconstruction and entering into any other borrowing arrangement. Further, any breach of terms under the company financing arrangements or its inability to meet the company obligations, including financial and other covenants under its debt financing arrangements could adversely affect the company's business and financial condition.
- Any future acquisitions, strategic investments and entries into new products that are used in conjunction with propulsion equipment could disrupt the company's business, divert its management's attention and harm the company's business.
- The company requires a significant amount of capital and the company future capital needs may requires it to obtain additional loans and borrowings or issue equity or debt securities, which may impose restrictions on the company's business activities and dilute its shareholders' equity. Further, failures to obtain additional financing on terms commercially acceptable to it may adversely affect the company ability to grow and the company's future profitability.
- The company is subject to strict quality requirements, customer inspections and audits, and any failures to comply with quality standards or faulty equipment may lead to product recall, corrective actions due to defects in its products or not meeting the specified level of performance / quality, cancellation of existing and future orders and could negatively impact the company reputation, its business, results of operations and future prospects.
- The company Key Managerial Personnel, Senior Management Personnel and other qualified personnel, including employees at Research, Design & Development Centre are critical to its continued success and the company may experience disruptions to its business if the company is unable to retain such personnel or attract new such personnel in the future.
- The company is exposed to the risk of loss of confidential technical knowledge which includes trade secrets, assembling and manufacturing processes, and other confidential information critical to its operations.
- Certain investors were previously granted special rights under a Shareholders' Agreement and Securities Subscription Agreement, which have since been terminated, and any adverse regulatory interpretation in relation to such arrangements or their subsequent re-classification as Promoter / Promoter Group may impact the Company.
- Technological advancements in railway propulsion and power electronics systems could render the company existing products less competitive or obsolete which may adversely affect its business, results of operations and ability to participate in new tenders issued by Indian Railways.
- The company's employees may engage in misconduct or other improper or illegal activities, including misrepresentation, non-compliance with regulatory requirements and breach of contractual obligations.
- The company depends on the timely availability of labour for its operations including engagement of contract workers for carrying out certain functions of the company's business operations. In the event of its inability to control the cost of the company labour force or non-availability of such contract workers at reasonable cost, any adverse regulatory orders or any default on payments to them by the agencies could lead to disruption of the manufacturing facilities and its business operations.
- Any failures of the company's software and information technology systems could adversely affect its business and operations. An actual or perceived cybersecurity or privacy breach could interrupt the company operations, harm its brand and adversely affect the company's reputation, brand, business, financial condition and results of operations.
- The company faces significant competition from domestic and international rail power electronics equipment manufacturers, which may lead to a difficulty for it to gain market share or growth, which in turn may adversely affect the company's business, results of operations, financial condition and cash flows.
- The threats and challenges in the power electronics equipment and cable protection & interconnect products in railway industry may have a material adverse effect on the company's business, financial condition, cash flows and results of operations.
- In future, its may be required to create warranty reserve and any insufficiency of the company warranty reserves to cover future warranty claims could have an adverse impact on its financials.
- The company uses heavy equipment & machinery and high power load at its assembling cum manufacturing facilities and Research, Design & Development centre which could cause bodily harm and accidents, which in turn could adversely impact the company operations.
- The company operations may be disrupted to breakdown of machinery at its units, labour unrest, slowdowns and increased wage costs, lead to prolonged outage of operations which may have a material adverse effect on the company's business, financial condition and results of operations. which may adversely affect its business, results of operations and financial condition.
- The company depends on adequate and uninterrupted availability of power for its operations, and any failures to do so may have an adverse impact on the company operations.
- Its may be negatively impacted by any early obsolescence of the company assembling cum manufacturing equipment and the spare parts used in such equipment.
- Its may not be successful in implementing the company's business strategies. Any failures to raise additional financing could have an adverse effect on its business, results of operations, financial condition and cash flows.
- The company relies on third-party transportation providers for both procurement of its raw materials and delivery of the company final products to customers. Disruption in transportation or failures by any of its transportation providers to deliver the company raw materials or its products on time, or in good condition, or at all, may adversely affect the company's business, financial condition and results of operations.
- The company has entered into, and will continue to enter into, related party transactions that may involve conflict of interest.
- Its may be subject to exchange rate fluctuations, which could materially and adversely impact the company's business, financial condition and results of operations.
- The company is exposed to interest rate risks because the company has borrowed funds at floating interest rates. Any changes in its interest rates could increase the company borrowing costs and in turn impact its profitability.
- The company relies primarily on insurance policies to insure its operations-related risks. If the company's insurance coverage is inadequate, it may have an adverse effect on its business, financial condition and results of operations.
- Failures to renew the company's leases agreements, or secure new leases for its Unit 1, Research, Design & Development centre, Registered cum Corporate office and the proposed new Research, Design & Development centre for which short term agreement has been executed could cause business disruptions.
- Some of the company Directors may not have experience as directors of companies listed on recognised stock exchanges in India.
- Certain sections of the Red Herring Prospectus contain information from the CareEdge Report which the company commissioned and paid for and any reliance on such information for making an investment decision in the Issue is subject to inherent risks.
- After the completion of the Issue, its Promoters along with the Promoter Group will continue to collectively hold substantial shareholding in the Company.
- Any variation in the amount of the Net Proceeds proposed to be utilised towards the objects as stated in the Red Herring Prospectus would be subject to certain compliance requirements, including prior Shareholders' approval.
- Its cannot assure payment of dividends on the Equity Shares in the future and the company ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements, capital expenditures and restrictive covenants of its financing arrangements.
- The company track certain operational metrics and non-generally accepted accounting principles, measures with internal systems and tools and does not independently verify such metrics. Certain of its operational metrics are subject to inherent challenges in measurement and any real or perceived inaccuracies in such metrics may adversely affect the company's business and reputation.
The Issue type of MV Electrosystems Ltd is Book Building.
The minimum application for shares of MV Electrosystems Ltd is 34.
The total shares issue of MV Electrosystems Ltd is 6823528.
Initial public issue of 68,23,528 equity shares of face value of Rs. 5 each (Equity Shares) of MV Electrosystems Limited (the Company) for cash at a price of Rs. 425 per equity share ( Including a Share Premium of Rs. 420 Per Equity Share) (Issue Price) aggregating up to Rs. 290.00 Crores (Issue). The issue shall constitute 25.01% of the company post-issue paid-up equity share capital of the company.
Price Band: Rs. 425 per equity share of face value of Rs. 5 each.
The floor price is 85.00 times the face value of the equity shares.
Bids can be made for a minimum of 34 equity shares of face value of Rs. 5 each and in multiples of 34 equity shares of face value of Rs. 5 each thereafter.