Eppeltone Engineers Ltd. IPO: Key Details

Eppeltone Engineers

• Eppeltone Engineers is coming out with an initial public offering (IPO) of 34,34,000 equity shares in a price band Rs 125-128 per equity share.
• The issue will open on June 17, 2025 and will close on June 19, 2025.
• The shares will be listed on SME Platform of NSE.
• The face value of the share is Rs 10 and is priced 12.50 times of its face value on the lower side and 12.80 times on the higher side.
• Book running lead manager to the issue is Expert Global Consultants.
• Compliance Officer for the issue is Megha Sharma.

Profile of the company

Eppeltone Engineers is engaged in the business of manufacturing of electronic energy meters including smart meters and various power conditioning devices like high grade chargers, UPS systems, etc. to consumers from institutions, industries and electricity distribution utilities. The company began its operations in the year 1977 and now operates a single manufacturing plant focused on producing quality and high-performance products. Over the years, it has streamlined its operations to ensure that its emphasis remains on quality and excellence.

The company is an ISO 9001, 140001 & 27001 certified organization engaged in the business of design, manufacturing and supply of Static Watt Hour Meters, Smart Meters, Water Meters, BPL Kits, UPS Systems, LED based luminaries, battery management system, battery chargers and battery packs, development of software applications, 4.5KW underslung constant voltage, regulated cum emergency battery charger, short neutral section assembly (phase break), light weight section insulator assembly, modular cantilever system, boxes and enclosures and all types of auto tensioning devices.

The company collects data from the customers, analyse the data and then design a customized/ Bespoke system which cater to the needs of its customers. It undertakes manufacturing and supply of finished products and intermediate stage products for its customers depending upon the demand. The company is engaged in business to business (B2B) segment. The primary focus of its business is to providing products and services to Government Entities, which constitute the majority of its business transactions. Additionally, it extends its B2B operations to private sector companies, supplying products to Non-Government and Government Companies across various industries.

Proceed is being used for:

• Working capital requirements of the company
• Funding capital expenditure towards installation of additional machinery at its factory
• General corporate purposes

Industry Overview

Electricity demand in India has grown exponentially on the back of rapid urbanization, and large-scale industrialization. The two factors have increased the pool of consumers, as well as increased the per head unit consumption. This developing demand landscape have led to a rapid scale up in generation sector - with capacity addition happening across thermal, hydroelectric, nuclear, and renewable energy. As of January 2024, the installed electricity generation capacity in the country reached approximately 430 GW. During the last five-year period (FY 2019 - 2023), the installed generation capacity in India has increased by a CAGR of nearly 4%. During the same period, electricity generated in the country increased by a CAGR of 4.2% to reach 1,624 billion units (BU) in FY 2023, and 1,452 billion units in FY 2024, as of January 2024.

Smart meter (with respect to electricity distribution sector) is part of the Advanced Metering Infrastructure (AMI) that defines the model electricity grid. AMI is a two-way communication system to collect real time information on electricity usage by the utility. AMI is a combination of hardware, software, and communication protocols. Based on the requirement of utility, AMI can collect electricity usage by consumer at hourly intervals or every 15 minutes. This eliminates the need for manual meter reading and bill generation. Smart meter is the hardware component of the AMI, which is installed at the consumer’s premise and records the power consumption happening at the consumers’ end.

Smart meters offer a win-win situation for both consumers and power distribution companies (DISCOMs). Consumers benefit from real-time energy monitoring, empowering them to make informed choices about their energy usage. This transparency allows them to identify areas for potential reduction, leading to lower electricity bills. Additionally, smart meters provide convenient features like remote meter reading, eliminating the need for manual meter readers and potential billing discrepancies. For DISCOMs, smart meters offer a multitude of advantages. They significantly reduce electricity theft, a major concern for the power sector. Furthermore, smart meters enable efficient billing processes, reducing administrative costs and improving revenue collection. Additionally, these meters provide valuable data on grid performance and consumer behavior, allowing DISCOMs to optimize grid management and improve overall efficiency. These widespread benefits for both consumers and DISCOMs further incentivize the adoption of smart meters, propelling the growth of the smart meter base across India. 

Pros and strengths

Strong and unique product technology: By leveraging its core technologies and unique ideas, it continued to provide new value to society. In 1999, the company broadened its business operations and established manufacturing facilities to produce energy meters in response to the government of India’s push for significant infrastructure projects. It has a NABL approved R&D Testing laboratory, with a focus on pioneering futuristic and innovative technologies. It has supporting facilities and offices in Noida, Uttar Pradesh and Okhla, New Delhi. The company is committed to providing consumers with quality, cost-effective metering goods and services. It has a CMMI Level III accreditation and certifications including ISO 9001,140001 & 27001 and ‘S’ mark safety accreditation from the Government of India.

Wide range of products and services: The company provides a broad range of products to its customers, it has significantly expanded its product portfolio from time to time. It also provides a wide range of turnkey services with the help of its trained employees and personnel, which increases the scope of its customers and its ability to cater to a diversified clientele base. Although the technical specifications for its products are largely standardized, it may undertake certain customizations of certain products for its institutional and corporate customers.

Consistency in quality and service standards: The company follows utmost quality standards in its areas of operation so that its products meet the required Quality standards. It helps it in maintaining a cordial relationship with its customers. Ensuring global standard products will attract domestic and international customers to the company.

Risks and concerns

Maximum revenue comes from limited customers: The company’s top ten customers contribute 85.73%, 94.73% and 91.55% of its total sales for the financial year ended on March 31 ,2025, March 31, 2024 and March 31, 2023, respectively. Its business operations are highly dependent on its customers and the loss of any of its customers may adversely affect its sales and consequently on its business and results of operations. While it typically has long term relationships with its customers, it has not entered into long term agreements with its customers and the success of its business is accordingly significantly dependent on it maintaining good relationships with its customers and suppliers. The actual sales by the company may differ from the estimates of its management due to the absence of long-term agreements. The loss of one or more of these significant or key customers or a reduction in the amount of business it obtains from them could have an adverse effect on its business, results of operations, financial condition and cash flows.

Significant topline comes from few states in India: Though the company supply its products on PAN India basis across all the states in India. However, a significant portion of its revenue is concentrated in some states across India. Any factors relating to political and geographical changes, growing competition and any change in the demand for its service by customers of these states may adversely affect its ability to retain them. The company cannot assure that it shall generate the same quantum of business, or any business at all, from these states, and loss of business from one or more of them may adversely affect its revenues and profitability.

No long-term contracts with its suppliers: The company’s ability to manufacture and make timely deliveries of its products is dependent upon the availability of raw materials and the cost incurred over them. It generally does not enter into agreements with its suppliers and transact with them on an order-by-order basis, and it cannot assure that it will continue to enjoy undisrupted relationships with its suppliers in the future. It cannot assure that it will be able to procure such specific raw materials in a timely manner or at commercially acceptable terms, or at all, resulting in delays in production and delivery of its products. If it is unable to obtain adequate supplies of raw materials in a timely manner or on commercially acceptable terms, the cost of raw material consumption can increase, which could have an adverse effect on its business, prospects, results of operations and financial condition.

Outlook

Eppeltone Engineers specializes in manufacturing electronic energy meters, including smart meters, alongside various power conditioning device. The company’s diverse product range caters to various sectors, including electricity utilities, industries, commercial establishments, and domestic consumers. The company has strong market presence & customer base. It also has advanced manufacturing & R&D capabilities. On the concern side, the company is dependent on few numbers of customers for sales. Loss of any of this large customer may affect its revenues and profitability. Moreover, significant portion of its revenue has been generated from some states of India, any loss of business from these states may adversely affect its revenues and profitability.

The company is coming out with a maiden IPO of 34,34,000 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 125-128 per equity share. The aggregate size of the offer is around Rs 42.93 crore to Rs 43.96 crore based on lower and upper price band respectively. On performance front, the company has reported 57.09% rise in total income at Rs 12,573.88 lakh in FY 25 as compared to Rs 8,004.18 lakh in FY24. The company’s net profit rose 37.67% to Rs 1,123.20 lakh in FY25 as compared to Rs 815.86 lakh in FY24.

After deepening its roots in the Indian market with its products and services, the company is further in progression of marking its presence globally. It intends to reach in the international arena too. Currently, the company is focused only certain States in India. It continually seeks to enhance its addressable market through private meetings with it proposed customers, by carrying out promotional activities to create awareness for its products. It plans to create a Strong and niche customer base for its products by increasing its focus on increasing its visibility with such institutional customers including Government Institutions, builders, and Developers of residential and commercial projects. Further, its emphasis is on expanding the scale of its operations as well as growing its supply chain network, which may provide opportunities to grow its client base and revenues.