Vikran Engineering IPO

As of June 30, 2025, the company claims to have completed 45 projects across 14 states, with a total executed contract value of Rs 1,919.92 crore. The company further states that it is handling 44 ongoing projects in 16 states, with an aggregate order value of Rs 5,120.21 crore.

The company is ISO 9001:2015 certified for quality management systems, ISO 14001:2015 certified for environmental management systems, and ISO 45001:2018 certified for occupational health and safety management.

The company works with several big clients, such as National Thermal Power Corporation (NTPC) Limited, Power Grid Corporation of India Limited, South Bihar and North Bihar power distribution companies, Transmission Corporation of Telangana Limited, and Madhya Pradesh Power Transmission Company Limited, among others. It is also executing projects for Assam Power Distribution Company Limited and the Eastern Central Railway (Danapur division).

The company claims that it has delivered projects involving overhead electrification and signalling systems. Its railway electrification portfolio includes overhead equipment (OHE) 25kV, 50 Hz alternating current (AC) railway electrification, 220 kV underground EHV cable works, and the construction of transmission lines and traction substations.

Vikran Engineering claims to have constructed 10 EHV substations of up to 765 kV and provides EPC services for air-insulated substations (AIS) of up to 400 kV.

The company claims that it has executed multiple system-strengthening projects under schemes such as the Rajiv Gandhi Grameen Vidyutikaran Yojana, Integrated Power Development Scheme (IPDS), Deendayal Upadhyay Gram Jyoti Yojana (DDUGJY), and Pradhan Mantri Sahaj Bijli Har Ghar Yojana (Saubhagya).

The company claims to have developed strong in-house resources that allow it to manage projects from planning and conceptualisation through to completion, ensuring effective monitoring and execution.

The company claims to have obtained pre-qualifications for government projects in several areas, including power transmission lines up to 400 kV, substations up to 765 kV, and power distribution projects at 33 kV and 11 kV levels, along with distribution substations and lines. The company states that it is also qualified to bid for energy meter service connection projects.

Along with inspections conducted by external agencies, the company claims to carry out internal inspections, audits, and strict quality checks of raw materials to maintain high project standards.

Over the past few years, the company has observed a consistent growth in its revenue from operations and profit after tax (PAT). Revenue from operations increased from Rs 524.30 crore in FY23 to Rs 785.95 crore in FY24 and Rs 915.85 crore in FY25. PAT increased from Rs 42.84 crore in FY23 to Rs 74.83 crore in FY24 and Rs 77.82 crore in FY25.

The company is a fast-growing EPC player. However, since most projects are awarded through competitive bidding, any delay in completion within contractual timelines could harm the company’s reputation and affect any business opportunities. Any inability to win, qualify for, or execute new contracts could negatively affect the company’s financial performance.

The company’s business is dependent on the tenders issued by government entities, the public sector, and the private sector. Out of these three sectors, the government sector contributed the most to the company’s order book. They accounted for Rs 1,262.05 crore (61.73 percent) of the company’s total order book in FY25, Rs 982.30 crore (46.45 percent) in FY24, and Rs 1,408 crore (68.82 percent) in FY23. Any adverse changes in the government’s power sector expenditure in the form of a decrease in the number or value of tenders released could negatively affect the company’s business and finances.

The company’s trade receivables amounted to Rs 634.33 crore in FY25, an increase from Rs 463.90 crore in FY24 and Rs 369.91 crore in FY23. Out of these, Rs 79.48 crore (12.19 percent) of the company’s total trade receivables in FY25, Rs 54.90 crore (11.56 percent) in FY24, and Rs 13.62 crore (3.63 percent) in FY23 were outstanding for more than six months from their due dates. Furthermore, a portion of trade receivables in FY25, amounting to Rs 29.29 crore, from a customer (RSDCL), remains under dispute and litigation, raising risks of delayed recovery or non-recovery. The company has also recognised bad debts amounting to Rs NIL, Rs NIL, and Rs 15.50 crore in FY25, FY24, and FY23, respectively. Delays in receivables collection, disputed claims, or higher-than-expected bad debts may strain working capital and adversely impact the company’s cash flows and overall financial performance.

The company reported negative cash flow from operating activities amounting to Rs 129.09 crore in FY25 and Rs 66.48 crore in FY24, despite being PAT positive in these periods. This raises concerns regarding the company’s ability to sustain profitability while also generating sufficient cash from operations.

The company’s top 10 customers accounted for Rs 806.66 crore (88.08 percent) of the company’s revenue in FY25, Rs 602.64 crore (76.68 percent) in FY24, and Rs 464.50 crore (88.59 percent) in FY23. The company’s top customer alone accounted for Rs 263.71 crore (28.79 percent) of the company’s revenue in FY25, Rs 167.05 crore (21.25 percent) in FY24, and Rs 134.69 crore (25.69 percent) in FY23. Any loss of any of these customers, or failure to expand the customer base, could adversely affect the company’s operations and finances.

The company derives a significant portion of its revenue from power transmission and distribution and water infrastructure verticals. Power transmission and distribution accounted for Rs 667.67 crore (72.90 percent) of the company’s total revenue in FY25, Rs 387.58 crore (49.31 percent) in FY24, and Rs 253.08 crore (48.27 percent) in FY23. Water infrastructure accounted for Rs 245.32 crore (26.79 percent) of the company’s revenue in FY25, Rs 387.34 crore (49.28 percent) in FY24, and Rs 259.01 crore (49.40 percent) in FY23. Any disruption in these sectors, including adverse changes in government policies or funding, could negatively impact the company’s operations and financial condition.

The top five suppliers accounted for Rs 93.85 crore (19.25 percent) of the company’s total raw material procured in FY25, Rs 73.48 crore (18.37 percent) in FY24, and Rs 50.11 crore (18.56 percent) in FY23. Any disruption in supplies from one or more of these suppliers could adversely affect the company’s business and finances.

Raw materials accounted for Rs 483.67 crore (59.55 percent) of the company’s total expenses in FY25, Rs 384.96 crore (55.74 percent) in FY24, and Rs 266.48 crore (55.92 percent) in FY23. Any adverse fluctuations in the cost of raw materials or a shortage in their availability could negatively affect the company’s finances and operations.

As of FY25, the company had contingent liabilities amounting to Rs 64.13 crore. If any of these contingent liabilities materialise, it could put pressure on the company’s finances.

The company, its promoters, and directors are involved in various legal proceedings, including criminal and tax-related cases. Any adverse judgment in any of the cases could be detrimental to the company’s business prospects.

As of June 30, 2025, the company reported a total indebtedness of Rs 606.30 crore. Any failure to service or repay these loans can harm the company’s operations and financial position.