IPO Note : KSH International Ltd by Angel One Ltd
Company Overview
* KSH International Limited is the third-largest manufacturer of magnet winding wires in India by production capacity in FY2025 and the largest exporter by export revenue, with over four decades of operating history, reflecting strong scale, execution capability and global competitiveness.
* The Company has a diversified product portfolio comprising round and rectangular enamelled copper and aluminium magnet winding wires, paper-insulated rectangular winding wires, continuously transposed conductors and bunched paper-insulated copper winding wires, which are critical components used in transformers, motors, alternators and generators.
* KSH is an approved supplier of insulated rectangular wires and continuously transposed conductors for select applications in High Voltage Direct Current and 765 kV extra high voltage transformers and reactors, with approvals from Power Grid Corporation of India Ltd, NTPC, Nuclear Power Corporation of India Ltd and the Research Design Standards Organisation, underscoring strong technical and quality credentials.
* The Company serves a diversified customer base of 122 customers in FY2025, 117 customers in FY2024 and 117 customers in FY2023, exports to 24 countries across the USA, UAE, Europe, the Middle East and Asia, and operates three manufacturing facilities in Maharashtra with a combined installed capacity of 29,045 MT as of June 30, 2025; a fourth facility at Supa, Ahilyanagar commenced operations in September 2025, further strengthening capacity and future growth.
Sector Outlook
* India’s electric wires and cables market was valued at USD 19.68 billion in CY2024 and is projected to reach USD 29.85 billion by CY2028, growing at a 10.98% CAGR, driven by expansion in power generation, transmission and distribution infrastructure, renewable energy integration, urbanisation and electric vehicle adoption.
* As magnet winding wires are critical inputs for transformers, motors and generators that underpin power, industrial, renewable energy and EV infrastructure, rising investments in HVDC and EHV projects, renewable capacity additions, industrial electrification and energy-efficiency initiatives provide strong medium- to long-term demand visibility for manufacturers such as KSH.
Company Outlook
* KSH International reported strong financial performance, with revenue increasing from Rs.1,382.8cr in FY24 to Rs.1,928.3cr in FY25 (+39.4% YoY). EBITDA rose from Rs.71.5cr to Rs.122.5cr, with margin expansion to 6.35%, while PAT grew from Rs.37.4cr to Rs.68.0cr, translating into a PAT margin of 3.5%. Export revenues stood at Rs.590.4cr in FY25, accounting for 30.6% of total revenue. The company also delivered healthy return ratios, with ROE of 22.7% and ROCE of 16.6% in FY25, while maintaining a debt-to-equity ratio of 1.17x.
* The company is raising funds through an IPO aggregating to Rs.710cr, comprising a fresh issue of Rs.420cr and an OFS of Rs.290cr by existing shareholders; the objects of the fresh issue include repayment of certain company borrowings amounting to Rs.225.98cr, purchase and setup of new machinery at 2 manufacturing plants amounting to Rs.87.02cr, purchase and setup of a rooftop solar power plant at the Supa facility amounting to Rs.8.83cr, with the balance to be utilised for general corporate purposes.
* At the upper price band of Rs.384, the IPO values the company at a post-issue P/E of 28.68x, indicating that the issue is fairly priced. However, strong earnings growth, improving return ratios, leadership in the magnet winding wires segment, and favourable demand tailwinds from power, renewables, EVs and industrial applications provide healthy long-term visibility. We therefore recommend a “Subscribe” rating for medium to long-term investors.
Key Risks
* Volatility in copper and aluminium prices can negatively affect the profitability of the company. Any loss of major customers or suppliers, supply disruptions, or delays in passing on sharp raw material price fluctuations could adversely impact margins and overall financial performance.
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