Management

• Dinesh Singhal: Chairman & Managing Director
• Adesh Singhal: Whole-time Director
• Vivek Singhal: Whole-time Director
• Abhishek Singhal: Whole-time Director
• Sangeeta Khorana: Independent Director
• Anil Bhardwaj: Independent Director
• Ashok Kumar Goel: Independent Director
• Ram Kumar Chugh: Independent Director

Use of Proceeds

The IPO comprises a Fresh Issue of up to Rs.300 crore and an Offer for Sale (OFS) by existing shareholders. The company will not receive any proceeds from the Offer for Sale; those proceeds will go directly to the selling shareholders after deducting applicable expenses and taxes.
The Net Proceeds from the Fresh Issue are proposed to be utilised for the following key objectives:

• Capital Expenditure – Rs.64.18 crore: Funding the capital expenditure requirements of Company
• Incremental Working Capital – Rs.155 crore: The company plans to strengthen working capital to support its growing operations and future business requirements.
• General Corporate Purposes

Competitive Strengths

Integrated manufacturing facilities equipped to deliver high-quality products. Kanohar Electricals operates two manufacturing facilities at Rithani and Gangol in Meerut, Uttar Pradesh, with an aggregate transformer manufacturing capacity of 19,200 MVA as of March 31, 2026. The Gangol facility can manufacture transformers up to 500 MVA, 400 kV, suitable for applications up to 765 kV. The integrated manufacturing setup enables better quality control, operational efficiency, cost optimisation and faster product delivery.

Backward integration at our manufacturing facilities The company has an in-house manufacturing setup for critical transformer components, including transformer tanks and radiators. Steel plates are processed internally into transformer tanks, while radiators are also manufactured indigenously. This reduces dependence on external vendors, improves quality control, lowers procurement and logistics costs, and supports faster lead times. The company also plans to further automate and expand its backward-integration capabilities through new machinery and equipment.

High quality transformers and capabilities for GIS Kanohar manufactures five types of transformers with customised technical specifications and has developed in-house technology for transformers up to 500 MVA, 400 kV. It also has capabilities in Gas Insulated Switchgear (GIS) through its technical collaboration with CHEM, Taiwan, established in 2017. Its integrated engineering, design and testing capabilities support product development, reliability and faster turnaround.

Track record of executing orders for large and marquee clients The company has demonstrated its execution capabilities across power transmission, railways, renewable energy and power distribution. It has supplied high-capacity transformers to central and state utilities, traction and Scott transformers to Indian Railways, and shunt reactors to renewable-energy companies. Its large order from POWERGRID for 500 MVA, 400 kV transformers further demonstrates its capability to execute complex, high-value contracts.

Experienced promoters and management team with significant industry experience Kanohar is led by an experienced promoter and management team with significant expertise in the transformer and electrical equipment industry. The company’s individual promoters include Dinesh Singhal, Adesh Singhal, Vivek Singhal, Abhishek Singhal, Virat Singhal and Aditya Singhal. The experienced leadership supports customer relationships, technical development, project execution and expansion across its target markets.

Track record of profitability Kanohar has demonstrated strong improvement in its financial performance, supported by growth in its transformer manufacturing and EPC businesses. Revenue from operations increased from Rs.276.69 crore in FY24 to Rs.653.84 crore in FY26, while its integrated business model and increasing scale have supported profitability. The RHP specifically identifies the company’s track record of profitability as one of the qualitative factors supporting the Offer Price.

Peer Comparison

Key Risks & Concerns

High dependence on Transformer Manufacturing Business Kanohar derives a significant portion of its revenue from the Transformer Manufacturing Business, which contributed 83.43% of revenue in FY26. Any slowdown in transformer demand, technological changes, regulatory developments or emergence of alternative technologies could adversely impact revenue, profitability and cash flows.

High customer concentration Customer concentration remains a key concern, with the top 10 customers contributing 93.16% of revenue in FY26, compared with 93.88% in FY25 and 95.43% in FY24. Loss of a major customer, lower orders or weaker customer finances could materially affect business performance.

Dependence on government and transmission utilities State transmission companies contributed 38.45% of FY26 revenue, while government entities accounted for 85.37% of total revenue through tender-led business. Changes in government policies, budget allocations, project delays or slower tendering could affect order inflows and revenue visibility.

Competitive tendering and order-win risk A substantial part of the business is secured through competitive tenders. The company participated in 45 bids worth Rs.6,495 crore in FY26 but won only nine tenders worth Rs.965 crore, implying a 20% bid-to-win ratio. Failure to maintain technical qualifications, financial capacity or competitive pricing could affect future order intake.

Raw-material and execution risks Transformer manufacturing remains exposed to availability and pricing of critical raw materials. Delays in procurement can affect delivery schedules, while adverse input-cost movements can pressure margins, particularly where contracts have fixed pricing. The company also faces risks from changing customer specifications and delivery schedules under make-to-order contracts.

Outlook and Valuation

Kanohar Electricals has a favourable medium- to long-term outlook, supported by rising investments in power transmission, grid strengthening, railway electrification and renewable-energy integration. The company’s order book increased sharply to Rs.1,818 crore as of March 31, 2026, from Rs.861 crore in FY25, providing strong revenue visibility. Its focus on high-voltage transformers, including 500 MVA/400 kV power transformers, traction transformers and Scott transformers, positions it well in specialised segments with relatively limited competition. The proposed expansion at the Gangol facility is expected to add 18,000 MVA of annual installed capacity, while automation and backward-integration initiatives should enhance operational efficiency, production throughput and delivery timelines.

Kanohar reported strong FY26 financial performance, with revenue of Rs.653.84 crore, EBITDA of Rs.180.42 crore and PAT of Rs.129.73 crore, translating into EBITDA and PAT margins of 27.59% and 19.84%, respectively. The company offers attractive exposure to India’s structural power transmission and distribution opportunity, supported by grid investments, renewable integration and growing demand for high-voltage transformers. However, high customer concentration, dependence on the transformer manufacturing business and significant exposure to government and transmission utility orders warrant valuation discipline. At the upper price band, the issue is valued at ~36x FY26 P/E. Given the strong growth outlook and earnings momentum, we recommend SUBSCRIBING to the issue, with potential for listing gains as well as medium- to long-term value creation.