IC Electricals IPO Review

Live Status

This one is live right now and the grey market is genuinely excited about it, though the subscription pattern has an odd twist.

• Open until 7 July. The IPO runs from 3 to 7 July, with listing on NSE SME on 10 July.
• Strong and rising GMP. The grey market premium has climbed steadily from zero to around Rs 45, a 45% premium, pointing to an estimated listing near Rs 144 against the Rs 99 issue price.
• Retail and HNI are enthusiastic, institutions are not. Overall subscription stands at 5.69x, driven by retail at 8.28x and HNI at 7.04x. But the QIB portion is barely filled at just 0.11x, an unusually weak institutional response for an IPO with this much retail buzz.

That QIB gap is worth watching closely as the week progresses, since institutions typically bid late, but such a low number this far in is not the usual pattern.

About the Company

What it does. IC Electricals, incorporated in 2005 and based in Okhla Industrial Area, New Delhi, manufactures electronic equipment for Indian Railways. Its product range includes regulators, battery chargers, emergency lights, inverters, microprocessor based control systems and vigilance control devices, along with railway components like alternators, traction motors and permanent magnet alternators.

Beyond manufacturing. The company also executes turnkey railway electrification projects, covering design, supply, erection, testing and commissioning of 25 kV AC overhead equipment and traction substations. You can follow its live GMP, subscription and listing updates on the IPO GMP Live homepage. It has completed electrification work on sections like Gorakhpur to Kaptanganj under North Eastern Railway.

Who it sells to. This is a pure Business to Government company, serving Indian Railways, railway zones and related public sector entities almost exclusively. As of May 2026 it employed 288 permanent staff, and as of August 2025 its order book stood at around Rs 158 crore.

Financial Snapshot

The growth looks strong on paper. Revenue rose from Rs 100 crore in FY24 to Rs 122 crore in FY25 and then to Rs 144 crore in FY26. Profit climbed from Rs 4.62 crore to Rs 9.41 crore to Rs 14.10 crore over the same three years, more than tripling in two years.

Why an experienced reviewer is cautious. Veteran SME analyst Dilip Davda specifically flagged that the company's boosted bottom line from FY25 onward raises eyebrows, and concluded the issue appears fully priced based on recent financial data. That is not a minor caveat, it comes from someone who has reviewed IPOs since 1978, and it echoes a pattern we have seen in a few other recent SME issues, where profit accelerates sharply right before a listing.

On valuation. At the upper price band of Rs 99, the post issue P/E works out to roughly 18 to 19 times FY26 earnings, which is not cheap for a company entirely dependent on government tenders and railway contracts. The order book of about Rs 158 crore gives some near term revenue visibility, but the business is inherently tied to how quickly and how often Indian Railways awards new contracts.

Strengths

Several things genuinely work in the company's favour here:

• A specialised, technical niche. Railway electronics and electrification is not a generic segment, it requires certification, tender track record and government trust, which raises the bar for new entrants.
• Real revenue and profit growth. Even setting aside the FY25 jump for scrutiny, the underlying trend across three years is upward, and the order book provides some visibility into near term work.
• Fresh issue structure. The entire IPO is a fresh issue with no offer for sale, meaning all the money raised goes into the company rather than to existing shareholders cashing out.
• Strong grey market and retail response. A GMP that has climbed to 45% and heavy retail and HNI subscription show real market enthusiasm for the railway theme this company represents.

Risks

The concerns here are specific and worth taking seriously:

• The FY25 profit jump needs scrutiny. An experienced, independent reviewer has directly flagged the recent profit acceleration as raising eyebrows and called the issue fully priced. That is a meaningful caution from someone with decades of comparing SME financials.
• Institutional demand is unusually weak. A QIB subscription of just 0.11x this deep into the issue is a real outlier compared to the enthusiastic retail and HNI response, and it is worth watching whether that gap closes by the final day.
• Heavy dependence on one customer type. Nearly all revenue comes from government departments and Indian Railways specifically, so any slowdown in tenders, delayed payments, or policy shifts would hit the company hard.
• Working capital intensive. Nearly all the fresh issue money, about Rs 33.6 crore of Rs 45.5 crore, is going into working capital, which reflects how much cash railway project execution ties up, and that need does not go away after listing.

A note on something else I came across while researching this one, a stray fragment on one source referenced a promoter governance dispute and a call to halt the IPO. I could not verify this against any other source or confirm it was actually about this company rather than unrelated ticker content on the same page, so I have left it out of the review itself. Given how serious that kind of claim would be if true, it is worth you personally checking the RHP and any recent exchange filings before publishing, just to be safe.

Should You Apply?

The IPO is open until 7 July, with a strong and rising grey market premium. This is a specialised railway electronics business with real growth, a specific profit sustainability question, and an unusual institutional demand gap.

• Conservative investors: Best to wait and watch. A profit run up specifically flagged as raising eyebrows by an experienced reviewer, combined with very low QIB participation so far, are reasons for caution even with the exciting GMP.
• Moderate investors: Could consider a small application for listing gains given the strong GMP, but should treat this as a short term trade rather than a long term conviction call until the profit trend is proven over more quarters.
• Aggressive investors: The GMP and retail enthusiasm make this attractive for a listing gain play, but watch the final day QIB numbers closely, since a continued institutional no show could signal that informed money sees something the retail crowd does not.

Honest take. The railway electronics niche is genuinely interesting and the fresh issue structure is clean, but a specific, credible warning about the sustainability of recent profit growth, paired with unusually weak institutional interest, means this is best treated as a listing gain trade rather than a long term hold until the company proves the FY25 and FY26 numbers are durable.

IPO Objects of the Issue

This is a fully fresh issue of about Rs 45.51 crore, with no offer for sale, so all the proceeds go to the company. Around Rs 33.60 crore is earmarked for working capital requirements, with the remainder going toward general corporate purposes. The heavy tilt toward working capital reflects how cash intensive railway project execution and government tender fulfilment can be.

Contact Details

• Company: IC Electricals Co. Ltd.
• Location: Okhla Industrial Area, New Delhi
• Business: Railway electronics manufacturing and railway electrification engineering, B2G model serving Indian Railways
• Registrar: Skyline Financial Services Pvt. Ltd.
• Lead Manager: NEXGEN Financial Solutions Pvt. Ltd.
• Listing: NSE SME

This page is not investment advice. GMP is indicative only and unofficial. Please consult a SEBI registered financial advisor before investing.