Parth Electricals IPO: Prospectus, GMP & Listing

Parth Electricals and Engineering Limited is launching its Initial Public Offering (IPO) in the SME segment. The company plans to use the funds to expand its business operations, strengthen its finances, and increase market reach in the power infrastructure sector.

IPO Highlights

The table below gives a quick overview of the IPO details:

Important IPO Dates

About the Company

Parth Electricals and Engineering Limited is a Vadodara-based company established in 2007. It focuses on:

• Manufacturing of RMUs (Ring Main Units) and Control & Relay Panels

• Protection and Automation Systems for power infrastructure

• EPC (Engineering, Procurement, and Construction) projects in transmission and distribution

Major Clients:

• Gujarat Energy Transmission Corporation (GETCO)

• Tata Power

• Siemens

• Larsen & Toubro (L&T)

• Schneider Electric

• Adani Green Energy

• Reliance Industries

The company is heavily involved in renewable energy projects, aligning with India’s growing focus on green power infrastructure.

Financial Performance

The company has shown strong growth in revenue and profit in recent years.

Key Financial Highlights:

• Revenue grew by 102% YoY in FY 2025.

• Profit after tax increased by 119% YoY.

• Debt reduction is expected post-IPO.

Financial Ratios

The rising EPS and ROE reflect strong profitability and growth potential.

IPO Objectives

Funds raised from the IPO will be used for:

IPO Allotment Structure

Retail investors can apply for 1 lot of 800 shares, requiring an investment of ₹1,36,000.

Grey Market Premium (GMP)

• Current GMP: ₹0

• Indicates neutral sentiment; listing gains may be limited.

• GMP can change based on subscription status and market conditions.

Peer Comparison

Parth Electricals is fairly valued compared to peers in the SME power and EPC segment.

Strengths of the Company

• Strong revenue and profit growth in the last three years

• Long-term clients like Siemens, Tata Power, and L&T

• Focus on renewable energy, aligning with government initiatives

• Expansion plans to increase capacity and reach

• Repeat orders, indicating customer trust

Risks to Consider

• High Client Concentration: GETCO and other few clients contribute major revenue

• Regional Dependence: Heavy focus on Gujarat projects

• Raw Material Price Volatility: Could affect profit margins

• Intense Competition: Both national and SME players compete in EPC and electrical manufacturing

• Government Policy Dependence: Revenue depends on infrastructure and renewable energy spending

Application and Allotment Process

Investors can apply via ASBA or UPI using their broker or bank app:

1. Select the IPO from the broker’s IPO list

2. Enter lot size (800 shares) and select cut-off price

3. Approve UPI mandate for payment

4. Wait for allotment results on August 7, 2025

Listing Gains vs Long-Term Holding: What Should Investors Choose?

Investors often face a dilemma during an IPO—apply for short-term listing gains or invest for long-term wealth creation. The decision for Parth Electricals IPO depends on market sentiment, company fundamentals, and grey market signals.

1. Listing Gain Perspective

• The grey market premium (GMP) for Parth Electricals is currently neutral (₹0).

• A low or neutral GMP suggests that immediate listing gains may be limited.

• SME IPOs with strong subscription and market buzz often deliver better listing performance.

Factors Influencing Listing Gains:

• Subscription Levels: High oversubscription in retail and HNI categories boosts listing demand.

• Market Conditions: Positive market trend in power and infrastructure stocks can lead to a surprise upside.

• Peer Performance: If other SME power sector IPOs list with strong premiums, sentiment may improve.

Short-Term Verdict:
If the market remains stable, a small premium or at-par listing is likely. Aggressive traders seeking quick profits should monitor subscription status and GMP trends before finalizing their strategy.

2. Long-Term Holding Perspective

Long-term holding may prove more rewarding because:

1. Robust Financial Growth: Revenue doubled in FY 2025 and profit grew 119% YoY.

2. Expansion Strategy: Funds will support new manufacturing units in Gujarat and Odisha, expanding market reach.

3. Focus on Renewable Energy: Government’s push for green energy is a major growth driver.

4. Strong Client Base: Contracts with Siemens, Tata Power, Adani, and L&T ensure revenue stability.

5. Valuation Comfort: P/E of 22.97x is reasonable compared to peers like RMC Switchgears and Supreme Power.

Long-Term Verdict:
Investors with a 12–24 month horizon can benefit from capacity expansion and market penetration. This IPO may offer wealth creation potential rather than instant profits.

3. Pros and Cons Table

4. Recommendation

• Traders: Monitor subscription data and GMP trends before expecting short-term listing gains.

• Investors: Prefer long-term holding to leverage the company’s growth in power infrastructure and renewable energy sectors.

• Portfolio Fit: Suitable for investors with moderate risk appetite and focus on SME growth stories.

Final Verdict

Parth Electricals IPO offers good long-term potential due to:

• Strong financial growth

• Industry tailwinds in renewable energy and power infrastructure

• Reasonable valuation compared to peers

Short-term listing gains may be limited due to neutral GMP, but long-term investors can consider applying for future growth prospects.

Key Takeaways

1. Parth Electricals IPO: Aug 4–6, 2025, price band ₹160–₹170.

2. Revenue doubled and profit grew 119% YoY in FY 2025.

3. Neutral GMP suggests focus on long-term holding over listing gains.

ALSO READ: Flysbs Aviation IPO: GMP, Review, and Key Details