As India powers toward a 500 GW renewable energy target by 2030, Prostarm Info Systems Limited is stepping into the spotlight with its Initial Public Offering (IPO) opening on May 27, 2025. This Mumbai-based company, a leader in energy storage and power conditioning equipment, aims to raise Rs. 168 crore through a fresh issue of 1.6 crore equity shares. With a client roster including Tata Power, NTPC, and the Airports Authority of India, Prostarm is well-positioned to capitalize on India’s Atmanirbhar Bharat and clean energy push. For investors eyeing high-growth sectors like renewable energy and defence (similar to BEL’s BrahMos contributions), this IPO offers a compelling opportunity. Below, we break down the IPO details, financials, key ratios, and investment potential to help you decide if Prostarm deserves a spot in your portfolio.
Prostarm Info Systems IPO: A Snapshot
Founded in 2008, Prostarm Info Systems designs, manufactures, and services power solution products, including UPS systems, solar hybrid inverters, lithium-ion battery packs, and servo-controlled voltage stabilizers. The company also undertakes rooftop solar photovoltaic (PV) projects on an EPC (Engineering, Procurement, and Construction) basis, serving sectors like defence, healthcare, railways, and aviation. With 22 branch offices across 17 states and 1 union territory, Prostarm’s nationwide presence and certifications (e.g., ISO 9001:2015, ISO 14001:2015) underscore its reliability.
The IPO is structured to fund expansion and reduce debt, making it a strategic move for growth. Below are three tables detailing the IPO structure, financial performance, and valuation metrics, sourced from the Red Herring Prospectus (RHP) and recent data.
Table 1: IPO Structure
|
Parameter |
Details |
|---|---|
|
Issue Type |
Book Built, Fresh Issue Only |
|
Issue Size |
Rs. 168 crore (1.6 crore equity shares) |
|
Price Band |
Rs. 95–105 per share |
|
Face Value |
Rs. 10 per share |
|
Lot Size |
142 shares (Retail: Rs. 14,910 at Rs. 105) |
|
Subscription Dates |
May 27–29, 2025 (Anchor Book: May 26, 2025) |
|
Investor Allocation |
QIB: 50%, Retail: 35%, NII: 15% |
|
Minimum Investment |
Retail: Rs. 14,910; sNII: Rs. 208,740 (1,988 shares); bNII: Rs. 1,013,880 (9,656 shares) |
|
Allotment Date |
May 30, 2025 |
|
Listing Date |
June 3, 2025 (BSE, NSE) |
|
Lead Manager |
Choice Capital Advisors Pvt Ltd |
|
Registrar |
KFIN Technologies Ltd |
|
Promoters |
Ram Agarwal, Sonu Ram Agarwal, Vikas Shyamsunder Agarwal |
|
Use of Proceeds |
Rs. 72.5 crore (working capital), Rs. 17.95 crore (debt repayment), Rs. 9 crore (subsidiary acquisition), rest for inorganic growth |
Table 2: Financial Performance
|
Period |
Revenue (Rs. Cr) |
PAT (Rs. Cr) |
EBITDA (Rs. Cr) |
EBITDA Margin (%) |
|---|---|---|---|---|
|
FY22 |
171.31 | 14.02 | 22.31 | 13.0 |
|
FY23 |
232.35 | 19.35 | 27.18 | 11.8 |
|
FY24 |
257.87 | 22.79 | 35.30 | 13.7 |
|
9M FY25 (ending Dec 2024) |
268.62 | 22.10 |
Not disclosed |
Not disclosed |
Table 3: Valuation and Key Ratios
|
Metric |
Value |
|---|---|
|
Market Cap (at Rs. 105) |
Rs. 618.18 crore |
|
EPS (FY24) |
Rs. 5.44 |
|
P/E Ratio (Pre-IPO, FY24) |
27.1x (at Rs. 105 / Rs. 5.44) |
|
P/E Ratio (Post-IPO, annualized 9M FY25) |
~21.4x (based on annualized PAT of Rs. 29.48 crore) |
|
Book Value (Pre-IPO, FY24) |
Rs. 20.45 per share |
|
Debt-to-Equity Ratio (FY24) |
0.78x (expected ~0.65x post-debt repayment) |
|
Return on Equity (RoE, FY24) |
26.6% (peer avg: 13.5%) |
|
Return on Capital Employed (RoCE, FY24) |
36.3% (peer avg: 21.7%) |
|
Grey Market Premium (GMP) |
Nil (as of May 23, 2025) |
Sources: Chittorgarh.com, IPO RHP, ipowatch.in, livemint.com
Why Prostarm Info Systems Stands Out
Prostarm’s business model aligns with India’s renewable energy and infrastructure growth:
-
Diverse Portfolio: Manufactures UPS systems (1–4800 KVA), solar inverters, and lithium-ion battery packs, with 10.56 MW of solar PV projects executed across 200+ sites (FY22–24).
-
Strong Clientele: Empaneled with Airports Authority of India, Railtel, and NTPC, ensuring stable demand.
-
Financial Growth: Revenue grew at a 22.69% CAGR (FY22–24), with PAT up 18% YoY in FY24. The RoE of 26.6% and RoCE of 36.3% outperform peers like Servotech (P/E 314.55x).
-
Defence Synergy: Supplies to defence and aviation, complementing your interest in stocks like BEL (P/E ~50x, involved in BrahMos) and HBL Engineering (Kavach systems).
Analyst Dilip Davda recommends subscribing for long-term gains, citing Prostarm’s integrated services and growth potential, though the IPO is considered fully priced at 27.1x P/E.
Risks to Consider
-
Tender Reliance: Solar EPC revenue depends on government tenders, risking delays.
-
Cash Flow: Negative operating cash flow in prior years, though improving.
-
Competition: Faces pressure from organized (e.g., Servotech) and unorganized players.
-
Debt: Debt-to-equity of 0.78x is manageable but requires monitoring post-IPO repayment.
Is Prostarm Info Systems IPO Worth It?
The P/E of 27.1x (FY24) is attractive compared to peers (Servotech: 314.55x, Sungarner: 152.68x), and the post-IPO P/E (~21.4x, annualized 9M FY25) suggests undervaluation for growth. The nil GMP (May 23, 2025) indicates a flat listing, but strong subscription (starting May 27) could drive gains, especially given India’s 16.83% CAGR in the solar UPS market (CareEdge). For retail investors, the Rs. 14,910 entry point is accessible, while long-term investors may benefit from Prostarm’s role in renewable energy.
- › Prostarm Info Systems IPO DRHP
- › Prostarm Info Systems IPO Addendum DRHP
- › Prostarm Info Systems IPO RHP
- prostarm Company official web site link
Notice: This article is crafted for information purposes alone and is not to be taken as financial advice. Investors are suggested to seek professional financial counsel before engaging in any investment decisions.