CHAMUNDA

Chamunda Electrical Limited reported a strong close to FY25, with revenue increasing to ₹25 crores from ₹20 crores in FY24, representing a 25% growth. PAT margin also saw an improvement, rising to 13.27% in FY25 from 11.5% in FY24. The company's recent IPO was significantly oversubscribed by 738 times, attracting ₹7,100 crores against a demand of ₹14.6 crores, demonstrating strong investor confidence.

The ₹14.6 crores raised through the IPO were strategically deployed. Key uses included the purchase of new kits and machinery (approximately ₹1.5 crores for testing equipment), repayment of all outstanding debt, making the company debt-free, and bolstering working capital requirements. This capital injection is crucial for supporting ongoing projects and future growth initiatives, particularly in the testing and solar divisions.

For FY25, the company's revenue mix was diversified across its core segments. Operation & Maintenance (O&M) contributed ₹19.34 crores, while the solar division generated ₹0.72 crores (72 lakhs). The testing division added ₹2 crores, and sub-station commissioning accounted for ₹3.50 crores. Management highlighted a current order book of ₹64 crores, with an expected execution of ₹20 crores in the first year and ₹24 crores in the second year.

Chamunda Electrical is actively expanding its solar energy footprint. The company currently operates 1.2 MW of solar capacity and recently secured approval for an additional 0.5 MW, bringing the total to 1.7 MW. There are ambitious plans to further increase solar capacity to 4.4 MW by March 2026, with an estimated investment of ₹12-15 crores for the 4 MW expansion over FY26-FY27. This segment is expected to contribute significantly to future recurring revenue, with a 25-year Power Purchase Agreement (PPA) in place.

The company's testing division is undergoing NABL certification, with the audit completed and provisional approval for 250 out of 350 scopes expected by December 2025. This certification is anticipated to increase testing revenue by 20% to ₹2.16 crores and open doors to a broader client base, including PSUs like ONGC, BPCL, and HPCL, which require NABL-certified services. New testing equipment, costing approximately ₹1.5 crores, is also on order from Germany, projected to generate ₹0.70-0.75 crores (70-75 lakhs) in annual revenue.

Management provided optimistic guidance, targeting total revenue of ₹31-33 crores for FY26 and ₹35.50-38 crores for FY27. They project an EBITDA growth of 25.32% and PAT growth of 13.50% for both FY26 and FY27, with PAT margins expected to remain sustainable at 13.50%. The company emphasizes its asset-light service industry model, which contributes to stable margins, and its long-standing relationships with government clients like GETCO.

The company maintains a robust working capital cycle, particularly with its government clients. Payments from GETCO are typically received in three tranches (October, January, March). For testing services, payments are received within 30 days. The solar division operates on a monthly PPA system. Management noted that trade receivables for March 2025 were ₹5.31 crores, with 70-80% from government bodies, considered secured. Trade payables were minimal at ₹0.10-0.11 crores (10-11 lakhs), indicating efficient cash flow management.