Rajasthan-based Mangal Electrical Industries plans to raise Rs 450 crore through an initial public offering (IPO) to fund its capacity expansion and working capital needs. The company filed its draft red herring prospectus (DRHP) with SEBI.

The IPO will consist solely of a fresh issue, with no offer-for-sale component, allowing the company to retain the entire proceeds. Additionally, Mangal Electrical may secure up to Rs 90 crore via a pre-IPO placement before filing the red herring prospectus with the Registrar of Companies. If successful, this amount will be deducted from the fresh issue.

Operating five production facilities in Rajasthan, the company manufactures transformer components, transformers, and customized products for the power infrastructure sector, with capacities ranging from single-phase 5 KVA units to three-phase 10 MVA medium power units. It also provides EPC services for setting up electrical substations. 

As of November 2024, its order book across business segments stood at Rs 97.87 crore, with clients including governmental utilities such as Ajmer Vidyut Vitran Nigam and Jaipur Vidyut Vitran Nigam, as well as private companies like Voltamp Transformers and Western Electrotrans.

Out of the IPO proceeds, Rs 96.03 crore will be allocated to debt repayment, with the company’s outstanding borrowings amounting to Rs 209.05 crore as of 15 November 2024. An additional Rs 120 crore will be used to expand its Unit IV facility in Sikar, Rajasthan, and improve the civil infrastructure at its Jaipur head office to optimize space and increase storage capacity.

Furthermore, Rs 122 crore will be earmarked for working capital requirements, with the remaining funds allocated to general corporate purposes.

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