Quality Power Electrical launched its IPO today, February 14, 2025, with the subscription window closing on February 18, 2025. The IPO aims to raise INR 858.7 crore. The price band is set between INR 401 and INR 425 per share, and the minimum lot size is 26 shares. The IPO consists of a fresh issue of shares worth INR 225 crore and an offer for sale (OFS) of 1.49 crore shares. Here’s a summary of Quality Power IPO recommendations by major brokerage houses. The company’s several brokerage houses have provided recommendations based on their analyses of its financial health and market potential. Read on for more.
Quality Power IPO Recommendations
Aditya Birla Money – Subscribe for long
Aditya Birla Money added another positive word in Quality Power IPO recommendations. “The company plans to raise Rs. 225 cr. as fresh issue with an intent to deploy the funds towards Mehru acquisition and capex funding. At the upper band of ₹425/ share, the issue is available at a P/E of 31x at extrapolated earnings of proforma financials which according to us is a fair premium in context of company’s growth potential & lean balance sheet. We recommend ‘Subscribe for long-term’ to the issue.”
Elite Wealth – Apply for listing gains and long-term
“From a valuation perspective, the company’s shares will be offered at a post-issue P/E ratio of 32.8, based on an expected FY25 annualized EPS of Rs 12.9. This appears to be reasonably valued, considering the company’s growth prospects and sectoral dynamics. We recommend that investors with a medium-to-long-term horizon consider applying for this issue. The investment presents potential for both listing gains and long-term capital appreciation.”
BP Wealth – Subscribe
BP Wealth has recommended that investors with subscribing tolerance consider applying for the Quality Power IPO. “The company is valued at a PE ratio of 81.9x on the upper price band based on FY24 earnings, which is lower than its peers. Given its strong financial growth, diverse product portfolio and global customer base, the company is well-positioned to achieve sustained growth within the sector. Therefore, we recommend a “SUBSCRIBE” rating for medium to long-term investment.”.
Samco Securities – Subscribe for long term
“A comparison of the company’s price-to-earnings (PE) ratio with that of its peers indicates that it is underpriced, as it is trading at a lower PE multiple than its industry counterparts. Additionally, the company is well-positioned to benefit from the ongoing energy transition from non-renewable to renewable sources, given its role in manufacturing critical high-voltage equipment for HVDC and FACTS networks—key components in integrating renewable energy into traditional power grids. Given its strong fundamentals and attractive valuation, the company presents a compelling long-term investment opportunity. Therefore, we recommend to subscribe for long term.”
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SBI Securities – Subscribe for long term
Analysts at SBI Securities added further to the positive Quality Power IPO recommendations. “Quality Power is valued at FY24 P/E and EV/EBITDA multiple of 59.3x and 80.8x respectively based on the upper price band on the post-issue capital which looks expensive. The proforma FY24 P/E and EV/EBITDA multiples (post acquisition of 51% stake in Mehru Electrical) is 50.1x/59.0x respectively which appears to be expensive looking at the relatively smaller scale of business. Although the company is doing well on financial metrics (Revenue/EBITDA/PAT CAGR of 28.3%/27.8%/14.6% respectively over FY22- FY24) and generates healthy return ratios in the range of 34-36%, we believe the listing gains can be muted due to relatively stretched valuations. Hence, we recommend investors only with long term investment horizon to subscribe to the issue at the cut-off price.”
Mehta Equities – Subscribe for long term
Mehta Equities has issued a clear “Subscribe” recommendation for the Quality Power IPO. “On valuation parse at the upper price band of ₹ 425/-, the issue is asking a Market Cap of ₹ 3291 cr/-. Based on annualized FY 2025 earnings and fully diluted post –IPO paid up capital, the company is asking for a P/E of 30.76x, which appears reasonable when compared to its listed industry peers. Given its recent strategic growth initiatives like acquisition of Mehru electricals which would allow company to expand its product range especially in 500kV transformers which could strengthens its position in high voltage equipment market, so we believe QPEEL is well-positioned to capitalize on India’s evolving energy landscape. Hence, with all attributes we recommend investors to “SUBSCRIBE” the Quality Power Electrical Equipments Ltd IPO for long term perspective.”
Quality Power IPO Recommendations – Bottomline
In conclusion, brokerage houses are generally optimistic about the Quality Power IPO, recommending subscriptions based on varying risk appetites and investment horizons. While some firms advocate for long-term investments due to growth potential, others emphasize caution due to market volatility and company size considerations.
While Quality Power IPO analyst views are mostly positive for long term, the informal or grey market is presenting confusing signals with a remarkable decline in premiums in recent days. This is not uncommon for the market to behave this way before large IPOs and Quality Power is going to make history with the biggest IPO in India. Nevertheless, investors are encouraged to assess their risk profiles and conduct thorough research before participating in this IPO.