The company that makes switchgears, lighting equipment, electric meters and wires and cables will be raising Rs 450 crore through an IPO.
Delhi-based HPL Electric & Power Limited that will come out with an Initial Public Offer (IPO) later this year plans to double its revenue share from exports from the present 2%. It will also be launching new products to increase its market share in electric meters.
The company that makes switchgears, lighting equipment, electric meters and wires and cables will be raising Rs 450 crore through an IPO. It intends to use the proceeds of the issue to reduce its debt, finance working capital, for other general corporate purposes and branding. It's outstanding debt is close to Rs 130 crore.
"We will not need funds immediately for capital expenditure as in the last couple of years we already invested in increasing production facilities, but after a few years we may utilise the margins for the same purpose," said Gautam Seth, joint managing director of HPL Electric & Power Ltd. In the last 5 years it invested Rs 270 crore in setting up two factories.
The gross revenue of the company is Rs 1,317 crore, with export orders contributing 2%. The company wants to double exports in next three years.
Among the new products lined up for launch will be Automatic Transfer System switch, which in case of load shedding or power failure will automatically switch over to generator within a fraction of a second. "Ours will be the first Indian firm to introduce it in the market. It will be useful for organisations where even a second of power disruption should not happen like hospitals or data centres," said G N Sharma, senior vice president of HPL Electric & Power Ltd.
With LED lighting market expected to grow from the present around Rs 4,000 crore to Rs 31,000 crore, it is expecting an increase in order books too.
The company's market share for meters is 44%, lighting at 23%, switch gears at 15% and wires-cables at 13%.
Another new product it has come up with is Smart Meters. This electric meter can be operated remotely without the power distribution company personnel visiting each and every residential, commercial or industrial connection. "Meter reading can be done in real time and if there are any dues, just by giving a command the power supply can be disconnected," added Sheth. The company already has received a couple of pilot orders from Maharashtra and Puducherry for this new technology of meters.
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