Kanohar Electricals
Kanohar Electricals, promoted by Dinesh Singhal, a technocrat, is one of leading domestic manufacturer of transformers in the country catering to high growth industries such as power transmission, railways, renewable energy, and power distribution. Apart from manufacturing transformers, the company is also undertaking EPC projects in power T&D sector. Under its EPC business, the company undertakes turnkey installation of air and gas insulated substations, bay augmentation in existing substations up to 400 kV class, and installation of transmission lines across 132 kV, 220 kV and 400 kV.
Transformer manufacturing business of the company manufactures five different types of transformers with customized technical specification to address the energy need of industries to which it caters. The product portfolio includes 1) power transformers (upto 500 MVA and 400 kv) used in power transmission; 2) traction transformers (30.24 MVA and 132 KV; 30.24 MVA and 220 KV) used in railways; 3) Scott transformers (100 MVA & 220/2X55 kv; 100 MVA & 132/2X55 kv) used in railways; 4) shunt reactors (upto 125 MVAR & 400kv) supplied largely to renewable energy sector and 5) distribution transformers (upto 5.5 MVA & 33 kv) used in power distribution.
Transformer manufacturing business of the company accounted for larger share of 83.43%/85.17%/51.75% of revenue from operations in FY26/FY25/FY24 with 16.44%/14.66%/48.06% from EPC business. Even within EPC business substation projects accounted for 6.75%/6.57%/41.65% of revenue from operations in FY26/FY25/FY24 and transmission lines account for 9.69%/8.09%/6.41%. Of the 83.43% share of revenue from operations by transformer manufacturing business about 57.09% from power transformers, 0.92% from traction transformers, 25.29% from Scott transformers, 0.13% from distribution transformers, nil from shunt reactors. In terms of transformer capacity of the 83.43% revenue from operations accounted by transformer manufacturing business, 52.17% came from transformers greater than 400kv, 10.99% from transformers of 220-400kv and 17.76% from 132-220 kv and 2.51% from transformers of less than 132 kv.
Of the FY26 revenue from operations about 85.37% is revenue from tenders awarded by government entities comprising 46.92% from central government and 38.45% from state government.
Order book of the company as end of March 31, 2026 stood at Rs 1818.323 crore [of which transformer manufacturing business 89.19% (power transformers 68%, traction transformers 1.98%, scott transformers 5.52%, shunt reactors 13.65%, distribution transformers 0.04%) and EPC business 10.81% (substations 6.67%; transmission lines 4.14%)] up from Rs 861.472 crore as end of March 31, 2025. Moreover of the order book as end of Mar 2026, the share of government sector is 93.62% [82.81% transformers mfg; 10.81% EPC] and private sector is 6.38%.
Currently the company operates two manufacturing facilities in Rithani (near Meerut, Uttar Pradesh) and Gangol (near Meerut, Uttar Pradesh) with an aggregate transformer manufacturing capacity of 19,200 MVA as on March 31, 2026. It has a backward integrated setup that supports in-house production of critical components for its transformers such as transformer tanks and radiators. Though the company currently manufactures power transformers up to 500 MVA and 400 kV class transformers, which are referred to as extra high voltage transformers, the manufacturing facilities of the company is also equipped to manufacture 765 kV power transformers, which are referred to as ultra-high voltage transformers.
The company also has the capability to manufacture gas insulated switchgear (?GIS?), which is used in high voltage power networks to safely and reliably control and protect electrical equipment in compact environments such as electrical substations. It have a technical collaboration with Chung-Hsin Electric and Machinery Manufacturing Corporation, Taiwan (?CHEM?), a global player in GIS SF6 technology. The collaboration agreement with CHEM is valid upto November 2027 with an automatic extension upto two years. In terms of the Technical Collaboration Agreement, it has to pay USD 0.50 million to CHEM as a technical documents fee, along with a royalty at the rate of 3% of the net sales price of the products, manufactured and/or assembled by it using CHEM?s ?proprietary technology? and sold by the company. While the company have manufactured and supplied up to 252 kV GIS bays from its Gangol manufacturing facility pursuant to the collaboration agreement with CHEM to transmission utilities of Uttarakhand and Himachal Pradesh, it have not generated any revenue from manufacturing of GIS in the last three fiscals, since no tenders requiring GIS were awarded to the company.
As on March 31, 2026, it is one of five companies in India to have the short circuit test certification for 500 MVA 400 kV transformers that are used in the power transmission industry. And it is also one of four manufacturers in India who are certified by Research Designs and Standards Organisation (RDSO), the research and development wing of Indian Railways, to manufacturing 100 MVA 132 kV Scott transformers. Further it is also one of two Indian manufacturers certified to manufacture 100 MVA 220 kV Scott transformers, both of which cater to the demand for rail network electrification from the Indian Railways.
Across its transformer manufacturing business and EPC business, it have successfully executed orders domestically in the states of Punjab, Rajasthan, Gujarat, Assam, Himachal Pradesh, Bihar, Maharashtra, Madhya Pradesh, Jharkhand, Karnataka, and overseas in Taiwan.
The company has conducted short circuit testing of its transformers at a scale and as on March 31, 2026 it have tested over 200 ratings. The company is in the process of exploring suitable bidding opportunities for supply of 765 kV transformers having the facility to manufacture it.
The issue, Objects of the issue
The offer comprises fresh issue of equity shares of Rs 2 each aggregating to Rs 300 crore and an offer for sale of 11957915 equity shares. The offer for sale component consists entirely of sale by K Sons Family Trust, a promoter selling shareholder.
Of the net proceeds from fresh issue, the company intends to use Rs 64.183 crore to fund capital expenditure requirements for 1) purchase of P&M for its Gangol plant for increasing transformer capacity, expanding and automating its backward integration facilities and enhancing operational efficiency, 2) construction of office building at Gangol plant, 3) enhancing sustainability initiatives a) setting up of solar power plant at its plants, b) purchase of EVs for handling/movement at Gangol plant; Rs 155 crore towards funding incremental working capital requirements and balance towards general corporate purposes.
Strengths
Established player with over 40 years of experience in the transformer manufacturing catering to high growth industries.
Comprehensive presence across transformer manufacturing and power T&D EPC enables it to serve a large total addressable market.
Integrated manufacturing facilities equipped to deliver high-quality products.
Track record of executing orders for large and marquee clients
Strong order book at Rs 1818 crore, translates into about 2.8 times of its FY26 revenue providing strong revenue visibility.
Strong investment pipeline in power T&D, renewable and railways to drive demand going forward. Special-purpose transformers, such as scott transformers, are expected to see steady demand, driven by the expansion of high-speed rail connectivity.
Competition in the high-voltage transformer (of above 400kv) space remains limited.
Any change in import policy allowing cheaper overseas imports.
Weaknesses
Top 1/3/10 customers accounted for 31.28%/58.93%/93.16% and 24.13%/54.05%/93.88% of the revenue from operations in FY26 and FY25 respectively.
Derive a significant portion of revenue from the supply of power transformers to transmission utilities including state transmission companies in the power transmission sector. About 38.45% of revenue in FY26 and 43% of order book as end of Mar 2026, came from supply to state transmission utilities. EPC business of the company is entirely dependent on government entities with all orders secured through tenders.
About 34 public Shareholders of the company who collectively hold 208,000 equity Shares are currently untraceable. Further, 156,000 Equity Shares issued to such shareholders pursuant to a bonus issue on September 19, 2025, along with the equity Shares previously held by them in the company, have not been credited to their demat accounts as it could not establish contact with them, and have been credited to a demat suspense account.
The company is unable to trace some of its historical corporate records. Further, certain corporate records have errors, and certain corporate filings have been made with delays, and it have remained non-compliant with the applicable laws for a certain period in the past.
Ability to manufacture GIS stems from technical collaboration with CHEM, if the company is unable to renew or extend this agreement on commercially acceptable terms will affect the company from participating in GIS business opportunities.
Business may be adversely affected if the company is unable to keep pace with technological developments and evolving industry trends in the power transmission and transformer sector such as HVDC etc.
Have experienced negative cash flows from operating activities in the past.
Valuation
Consolidated re-stated revenue for the fiscal ending March 2026 stood higher by 45% to Rs 653.84 crore. With OPM expand by 690 bps to 27.6%, the growth of OP was 93% to Rs 180.42 crore. Finally, net profit was higher by 99% to Rs 129.73 crore.
On expanded equity, the EPS for FY2026 was Rs 16.4. On the upper price band, the PE works out to 38.5 times of its FY26 EPS. P/BV stood at 7.4 times and EV/Sales stood 7.6 times. ROE stands at 13.3%.
In comparison, Transformers & rectifiers India (TRIL), Atlanta Electricals and Into Tech Transformers who have presence in power transformers of similar capacity quotes at a PE of 34.1 times, 71.2 times and 41.9 times. Price/BV of TRIL, Atlanta Electricals and Indo Tech Transformers quotes at 6 times, 15.5 times and 10.4 times and at a EV/sales of 3.8 times, 7.8 times and 5 times.
ROE of TRIL, Atlanta Electricals and Into Tech Transformers were 17.5%, 21.8% and 24.8 times and the OPM for FY26 was 15.3%, 18.5% and 15.4%.
| Kanohar Electricals : Re-stated Consolidated Financials |
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| 2403 (12) | 2503 (12) | 2603 (12) | |||
| Sales | 276.69 | 450.61 | 653.84 | |||
| OPM (%) | 11.2 | 20.7 | 27.6 | |||
| OP | 31.07 | 93.39 | 180.42 | |||
| Other income | 4.43 | 6.68 | 9.02 | |||
| PBIDT | 35.50 | 100.08 | 189.44 | |||
| Interest | 6.48 | 9.40 | 12.91 | |||
| PBDT | 29.02 | 90.68 | 176.53 | |||
| Depreciation | 3.15 | 2.88 | 2.96 | |||
| PBT | 25.87 | 87.79 | 173.58 | |||
| EO Exp | 0.00 | 0.00 | 0.00 | |||
| PBT after EO | 25.87 | 87.79 | 173.58 | |||
| Tax | 8.11 | 22.67 | 43.84 | |||
| PAT | 17.76 | 65.12 | 129.73 | |||
| Share of Profit from Associates | 0.00 | 0.00 | 0.00 | |||
| Minority Interest | 0.00 | 0.00 | 0.00 | |||
| Net profit after MI | 17.76 | 65.12 | 129.73 | |||
| EPS (Rs)* | 2.2 | 8.2 | 16.4 | |||
| * on post IPO fully dilluted equity (on upper price band) of Rs 15.84 crore. Face Value: Rs 2 | ||||||
| EPS is calculated after excluding EO and relevant tax | ||||||
| Figures in Rs crore | ||||||
| Source: Capitaline Corporate database | ||||||
| Kanohar Electricals : Issue Highlights |
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| Fresh Issue (Rs crore) | 300 |
| Offer for sale (in nos.) | 11957915 |
| Price band (Rs.) ** |
|
| Upper | 632 |
| Lower | 601 |
| Post-issue equity (Rs crore) | |
| in Upper price band | 15.84 |
| in Lower Price Band | 15.89 |
| Post-issue promoter (including promoter group) stake (%) | 78.64 |
| Minimum Bid (in nos.) | 23 |
| Issue Open Date | 08-09-2026 |
| Issue Close Date | 10-09-2026 |
| Listing | BSE, NSE |
| Rating | 47/100 |
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