Exicom Tele-Systems IPO - Review & Fundamental Analysis

Exicom Tele-Systems IPO

Exicom Tele-Systems consists of a fresh issue of shares worth INR 400 crores and an offer to sell 740 crores of existing equity shares. The company will use the funds raised for facility setup, debt repayment, working capital, R&D, and general corporate purposes for the company’s financial allocation.

Exicom Tele-Systems Ltd IPO – Important Details

Exicom Tele-Systems IPO DateFebruary 27, 2024 to February 29, 2024
Exicom Tele-Systems IPO Listing DateMarch 5, 2024
Exicom Tele-Systems IPO PriceINR 135 to 142 per share
Exicom Tele-Systems IPO Lot Size100 Shares
Exicom Tele-Systems IPO Total Issue SizeINR 429.00 Cr
Exicom Tele-Systems IPO Basis of AllotmentMarch 1, 2024
Exicom Tele-Systems IPO Initiation of RefundsMarch 4, 2024
Exicom Tele-Systems IPO Credit of Shares to DematMarch 4, 2024
Exicom Tele-Systems IPO Issue TypeBook Built Issue IPO
Exicom Tele-Systems IPO Listing AtBSE, NSE

Exicom Tele-Systems Ltd IPO – Company Profile

Exicom Tele-Systems, established in 1994, is an Indian power management solutions provider with two business verticals. The company specializes in EV charging solutions and critical power infrastructure for telecommunications and enterprise environments globally.

As of March 31, 2023, Exicom Tele-Systems is a market leader in EV Chargers with a 60% and 25% market share in residential and public charging, respectively. In Critical Power, it holds a 16% share in DC Power Systems and a 10% share in Li-ion Batteries for telecommunications.

Exicom Tele-Systems strives to catalyze the sustainable energy transition, focusing on electrifying transportation and ensuring energy stability for digital communication infrastructure, thereby contributing to environmental responsibility and technological advancement.

Exicom Tele-Systems Limited IPO – Fundamental Analysis

Exicom Tele-Systems Limited displays consistent revenue growth, increasing profitability, and a strengthening financial position. The rising RoNW, EPS, and NAV per share are positive indicators for potential investors.

Revenue Growth: 

The company’s revenue increased from ₹51,290.05 million in 2021 to ₹70,079.30 million in 2023. However, there was a dip in 2022, which should be investigated further.

Equity Growth: 

Equity has shown a steady increase from ₹2,134.42 million in 2021 to ₹2,319.99 million in 2023, indicating strengthening shareholder equity.

Expenses: 

Expenses have generally increased, aligning with revenue growth, but there was a reduction in expenses in 2023.

Profit After Tax: 

Net profit has increased consistently, rising from ₹34.50 million in 2021 to ₹63.72 million in 2023, reflecting improved profitability.

Return on Net Worth (RoNW): 

RoNW has been growing, reaching 13.38% in 2023, indicating efficient use of equity for generating profits.

Earnings Per Share (EPS): 

There’s a significant increase in EPS from ₹1.38 in 2021 to ₹3.38 in 2023, suggesting higher profitability per share.

Net Asset Value (NAV) per Equity Share: 

NAV per share has also consistently increased, reflecting growing intrinsic value.

Total Assets and Liabilities: 

Total assets have shown growth over the years, with a corresponding increase in liabilities. This suggests a healthy balance between assets and liabilities.

Gross Profit Margin: 

The gross profit margin has improved over the years, indicating better profitability on sales.

Exicom Tele-Systems Limited IPO Financial Information

ParticularAs at 31 March 2021As at 31 March 2022As at 31 March 2023
Revenue (₹ in Million)5,129058,428.057,079.30
Equity (₹ in Million)2,134.422,215.722,319.99
Expenses (₹ in Million)5,115.368,091.886,909.58
Profit and Loss After Tax (₹ in Million)34.5051.3663.72
RoNW (%)5.9413.7213.38
NAV per Equity Share (₹)23.2224.1025.24
Diluted EPS only (₹)1.383.313.38
Total Assets (in million)6,784.596,029.937,050.90
Total Liabilities (in million)4,650.173,814.214,730.91
Gross profit margin (%)22.6621.2524.75

Exicom Tele-Systems Limited IPO Peer Comparison

Exicom Tele-Systems Limited, with revenue of ₹7,079.30 million and RoNW of 13.38%, displays lower revenue than Servotech Power Systems and HBL Power Systems. However, it has a more favorable EPS (₹3.38) and NAV per share (₹25.24), indicating potential for efficient profit generation and higher intrinsic value.

CompanyRevenue (₹ in million)Face Value per Equity Share (₹)P/EEPS (Basic) (₹)EPS (Diluted) (₹)RoNW (%)NAV per Equity Share (Basic) (₹)
Exicom Tele-Systems Limited7,079.3010NA3.383.3813.3825.24
Servotech Power Systems Limited2,784.811158.370.520.5613.473.86
HBL Power Systems Limited13,686.78175.703.513.5110.3534.32

Exicom Tele-Systems Ltd IPO Objective

The main objective of Exicom Tele-Systems Limited’s IPO is to set up a production unit, debt reduction, meet the working capital requirements, and fund business-related R&D expenditures.

  1. To set up of production/assembly lines at the planned manufacturing facility in Telangana: The company aims to utilize INR 151.471 crore from the Net Proceeds towards part-financing the cost of setting up production/assembly lines at their planned manufacturing facility, proposed to be situated on the industrial land. 
  2. Repayment of borrowings availed by the company: The Company proposes to utilize an estimated amount of INR 50.298 crores from the Net Proceeds towards full or partial repayment/ prepayment of all or a portion of certain borrowings availed by their Company. The Company aims to reduce debt, maintain a favorable ratio, and utilize internal accruals for business growth.
  3. Part-funding incremental working capital requirements: The Company proposes to utilize up to INR 69 crores from the Net Proceeds to fund the working capital requirements of the Company in the Financial Year 2025.
  4. Investment in R&D and product development: The Company intends to utilize INR 40 crores from the Net Proceeds towards investment in product development opportunities. The Company leverages EV charging expertise, aims for innovative enhancements, introduces newer versions, and tailors solutions for customers.
  5. General corporate purposes:  The Company plans to deploy the balance funds towards the general corporate goals, including a strategic focus on inorganic expansion, marketing strength, personnel, corporate exigencies, and multifaceted purposes.

Exicom Tele-Systems Ltd IPO Risks and Challenges

Exicom Tele-Systems faces risks in the EV industry, such as unpredictability, customer dependency, and global raw material sourcing. Uncertainties in EV market dynamics, customer relations, and international dependencies challenge business stability, financial prospects, and operational profitability.

  • Profitability hinges on unpredictable EV adoption, regulatory support, and charger usage. Despite India’s rapid EV market growth, uncertainties in technology, regulations, and consumer preferences pose risks, potentially harming business and financial prospects. 
  • Dependence on critical customers for revenue poses risks. Loss of customers due to disputes or financial hardships could harm business. Reliance on purchase orders with firm commitments adds certainty. Cancellations may impact results, with no assurance of consistent customer demand.
  • They import critical raw materials from suppliers in China, Singapore, Hong Kong, and South Korea without fixed-price arrangements. Volatility in global markets and dependence on overseas suppliers pose risks to sourcing costs, impacting operations and profitability.

Exicom Tele-Systems Limited IPO – Industry & Market Potential

The global telecommunications industry, driven by smartphone adoption and 5G deployment, sees increased demand with IoT proliferation. Edge computing enhances real-time applications, and efforts to bridge the digital divide through innovative solutions and internet access initiatives persist.

The Indian telecommunications industry boasts a vast customer base and high mobile penetration, with over 1,142 million mobile subscribers as of the Financial Year 2022. The focus is on steadily growing and offering affordable voice and data services.

The telecommunication power market is driven by rising demand for mobile data, 4G/5G network adoption, and the necessity for reliable power supply to telecom towers. It is projected to grow at a 9.4% CAGR, reaching USD 6.6 billion by 2028.

Exicom Tele-Systems IPO – Type of Offer

Exicom Tele-Systems plans a fresh issue of shares, seeking INR 400 crores to augment the company’s capital needs. Additionally, the company proposes an offer for sale, intending to sell 740 crore existing shares.

1.  Fresh Issue: The company will issue new shares to raise capital, aiming to collect INR 400 crores. The company intends to utilize the proceeds from the fresh issue for facility setup, debt repayment, working capital, R&D, and general corporate purposes for the company’s financial allocation.

2.  Offer for sale: Exicom Tele-Systems is offering to sell 740 crore existing shares. The following are the details of the existing shareholders who are also the promoters selling the shares:

Name of the promoter selling shareholderMaximum number of offered shares for sale (in million)
Next Wave Communications Private Limited7,400,000

Exicom Tele-Systems IPO Offer Size

The offer size of Exicom Tele-Systems IPO is INR 429.00 crores. The offer comprises a new issuance of shares totaling INR 400 crores and the sale of 740 crores of existing equity shares. The funds generated will be utilized for facility setup, debt repayment, working capital, R&D, and general corporate purposes for the Company’s financial allocation.

Exicom Tele-Systems IPO Allotment Structure

Exicom Tele-Systems allocation will be as follows: 75% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 10% for Retail Individual Investors (RII) in accordance with SEBI regulations

Qualified Institutional Buyers (QIB): As per SEBI regulations, 75% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers. These include entities such as banks, mutual funds, and insurance companies.

Non-Institutional Investors (NII): 15% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs.2 lakhs.

Retail Individual Investors (RII): The remaining 10% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs.2 lakhs.

How to apply for an Exicom Tele-Systems IPO?

To apply for the Exicom Tele-Systems IPO through Alice Blue, you would typically follow these steps:

1. Open a Demat and Trading Account: If you don’t have one already, you would need to open a Demat and trading account with Alice Blue.

2. Check for IPO Details: Once your account is active, you can check for the Exicom Tele-Systems IPO details in the IPO section of the Alice Blue platform.

3. Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.

4. Submit the Application: Confirm all your details and submit your application.

 You can apply for Exicom Tele-Systems Limited’s IPO at Alice Blue in just a few clicks!

Check Allotment Status: After the allotment process, you can check the allotment status to see if you have received any shares.

Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How to Check Exicom Tele-Systems IPO Allotment Status on Alice Blue?

Checking the allotme